Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
06-20-2017 Agenda Packet
Tuesday, June 20, 2017 5:30 PM REGULAR MEETING Council Hearing Room 990 Palm Street San Luis Obispo Page 1 CALL TO ORDER: Mayor Heidi Harmon ROLL CALL: Council Members Carlyn Christianson, Aaron Gomez, Andy Pease, Vice Mayor Dan Rivoire and Mayor Heidi Harmon PUBLIC COMMENT ON CLOSED SESSION ITEM CLOSED SESSION A. CONFERENCE WITH LEGAL COUNSEL –EXISTING LITIGATION Paragraph (1) of subdivision (d) of Government Code § 54956.9; Name of case: Friends of 71 Palomar v. City Council of San Luis Obispo, et al.; San Luis Obispo Superior Court Case No. 17CV-0259 ADJOURN TO THE REGULAR MEETING OF JUNE 20, 2017 Packet Pg 1 San Luis Obispo City Council Agenda June 20, 2017 Page 2 6:00 PM REGULAR MEETING Council Chamber 990 Palm Street CALL TO ORDER: Mayor Heidi Harmon ROLL CALL: Council Members Carlyn Christianson, Aaron Gomez, Andy Pease, Vice Mayor Dan Rivoire and Mayor Heidi Harmon PLEDGE OF ALLEGIANCE: Vice Mayor Dan Rivoire CITY ATTORNEY REPORT ON CLOSED SESSION PRESENTATIONS 1. PRESENTATION - POLICE DEPARTMENT COMMENDATIONS/AWARD PINNING (CANTRELL – 10 MINUTES) Presentation by Police Chief Cantrell, recognizing two Officers for their Lifesaving actions and a Cal Poly student for her contribution to public safety. 2. PROCLAMATION - SAN LUIS OBISPO MUSEUM OF ART (HARMON – 5 MINUTES) Presentation of a proclamation to Karen Kile, Executive Director, representing the San Luis Obispo Museum of Art, recognizing how an investment in the San Luis Obispo Museum of Art’s distinctive new home will ensure that a revitalized Museum of Art can continue to have a significant and lasting impact on this City’s excellent cultural and economic well- being, now and for future generations. PUBLIC COMMENT PERIOD FOR ITEMS NOT ON THE AGENDA (not to exceed 15 minutes total) The Council welcomes your input. You may address the Council by completing a speaker slip and giving it to the City Clerk prior to the meeting. At this time, you may address the Council on items that are not on the agenda. Time limit is three minutes. State law does not allow the Council to discuss or take action on issues not on the agenda, except that members of the Council or staff may briefly respond to statements made or questions posed by persons exercising their public testimony rights (gov. Code sec. 54954.2). Staff may be asked to follow up on such items. Packet Pg 2 San Luis Obispo City Council Agenda June 20, 2017 Page 3 CONSENT AGENDA A member of the public may request the Council to pull an item for discussion. Pulled items shall be heard at the close of the Consent Agenda unless a majority of the Council chooses another time. The public may comment on any and all items on the Consent Agenda within the three minute time limit. 3. WAIVE READING IN FULL OF ALL RESOLUTIONS AND ORDINANCES Recommendation Waive reading of all resolutions and ordinances as appropriate. 4. MINUTES OF MARCH 28, 2017 (GALLAGHER) Recommendation Approve the Minutes of the City Council meeting of March 28, 2017. 5. REVISED 2016 WATER RESOURCES STATUS REPORT (MATTINGLY / FLOYD / METZ / BOERMAN) Recommendation Receive and file the Revised 2016 Water Resources Status Report. 6. RESOLUTION EXTENDING THE DELEGATION OF INVESTMENT AUTHORITY TO THE CITY TREASURER THROUGH THE 2017-18 FISCAL YEAR (BRADFORD / PARDO) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, extending the delegation of Investment Authority to the City Treasurer through the 2017-18 Fiscal Year.” 7. APPROVAL OF THE FINAL MAP FOR TRACT 2928, 1321 OSOS STREET (TR 96- 13) (CODRON / DOSTALEK) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, approving the final map for Tract 2928 (1321 Osos Street, TR 96-13)” authorizing the Mayor to execute a Subdivision Agreement, and authorizing the Public Works Director to accept the subdivision improvements and release the securities. Packet Pg 3 San Luis Obispo City Council Agenda June 20, 2017 Page 4 8. RESOLUTION AUTHORIZING PETSAFE® BARK FOR YOUR PARK™ GRANT PROGRAM APPLICATION (STANWYCK / MUDGETT) Recommendation 1. As recommended by the Parks and Recreation Commission, adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, authorizing the Parks and Recreation Director, or their designee, to execute and fulfill any related PetSafe® Bark for Your Park™ grant applications, certifications, assurances, forms, agreements, and associated documents on behalf of the City,” for a grant total amount not to exceed $25,000 for the design and construction of a new PetSafe® dog park within City limits. 2. Authorize the City Manager to take necessary action to include the project in the budget and Capital Improvement Program upon grant award. 9. APPROVAL OF A REIMBURSEMENT AGREEMENT WITH AMBIENT COMMUNITIES FOR OFFSITE AND OVERSIZED PUBLIC IMPROVEMENTS ASSOCIATED WITH ORCUTT AREA SPECIFIC PLAN DEVELOPMENT PROJECTS (CODRON / DOSTALEK) Recommendation 1. Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, approving a Reimbursement Agreement with Ambient Communities for offsite and oversized public improvements associated with Orcutt Area Specific Plan development projects” and; 2. Authorize the Mayor to execute said Agreement, and authorize the Public Works Director to implement said Agreement. 10. RESOLUTION AUTHORIZING THE COUNTY’S COLLECTION OF FIRE AND LIFE SAFETY INSPECTION FEES (OLSON / MAGGIO) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, authorizing the San Luis Obispo County Auditor to collect fees for 2017-18 fire and life safety inspections of multi-dwelling properties containing three or more dwelling units on the secured property tax roll pursuant to California Government Code Section 54988, et seq.” Packet Pg 4 San Luis Obispo City Council Agenda June 20, 2017 Page 5 11. MONTEREY/OSOS TRAFFIC SIGNAL INSTALLATION, SPECIFICATION NO. 91377 (GRIGSBY / WHEELER) Recommendation 1. Approve Plans and Specifications for the “Monterey/Osos Traffic Signal Installation Project, Specification No. 91377,” and authorize staff to advertise for construction bids; and 2. Authorize the City Manager to award a contract if the total of the bid plus contingency is within the available project at time of award; and 3. Approve the transfer of $191,000 from various Public Works Transportation accounts to the Monterey/Osos Traffic Signal Installation Project account. 12. APPROPRIATIONS LIMIT FOR 2017-18 (BRADFORD / PARDO) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, adopting the appropriations limit for 2017-18” for the City of San Luis Obispo. PUBLIC HEARING ITEMS AND BUSINESS ITEMS 13. PUBLIC HEARING - ADOPTION OF 2017-19 FINANCIAL PLAN AND 2017-18 BUDGET (LICHTIG / BRADFORD – 120 MINUTES) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, approving the 2017-19 Financial Plan and 2017-18 Budget.” Packet Pg 5 San Luis Obispo City Council Agenda June 20, 2017 Page 6 14. PUBLIC HEARING - TAX AND EQUITY FISCAL RESPONSIBILITY ACT (TEFRA) HEARING REGARDING THE HOUSING AUTHORITY OF SAN LUIS OBISPO ISSUANCE OF A TAX-EXEMPT DEBT OBLIGATION TO FINANCE THE REHABILITATION BOND OF 55 AFFORDABLE HOUSING UNITS AT 1092 ORCUTT ROAD, 1102 IRONBARK, AND 1363 PISMO STREET (CODRON / OROZCO – 10 MINUTES) Recommendation 1. Conduct a public hearing under the Tax and Equity Fiscal Responsibility Act (TEFRA) of 1982 pursuant to the requirements of the Internal Revenue Code of 1986; and 2. Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, approving the incurring of a tax -exempt obligation by the Housing Authority of the City of San Luis Obispo for the purpose of providing additional financing for the rehabilitation of Laurel Creek, Ironbark and Pismo Buchon Apartments.” 15. RESCINDING THE LOCAL DROUGHT EMERGENCY AND ASSOCIATED RESOLUTIONS (MATTINGLY / FLOYD / BOERMAN / METZ – 30 MINUTES) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of S an Luis Obispo, California, rescinding the local drought emergency associated resolutions restricting water usage” which will do the following: a. Rescind Resolution Nos. 10566, 10627, 10628, and 10635, ending the local drought emergency declaration and associated water use restrictions; and b. Rescind Resolution No. 10629 which authorized and established a permit fee and regulations for the use of the Corporation Yard non-potable well and direct staff to make necessary changes to eliminate public access to the well. 16. COMMUNITY BUDGET TASK FORCE (JOHNSON – 30 MINUTES) Recommendation Adopt a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, creating the Community Budget Task Force to provide recommendations for priorities and options to maintain fiscal sustainability.” Packet Pg 6 San Luis Obispo City Council Agenda June 20, 2017 Page 7 17. BUSINESS LICENSE COMPLIANCE PROGRAM IMPLEMENTATION PLAN (BRADFORD – 20 MINUTES) Recommendation Approve Business License Compliance implementation plan. 18. SUPPORT FOR THE GOALS OF CALIFORNIA SENATE BILL 562: THE HEALTHY CALIFORNIA ACT (DIETRICK / WHITE - 15 MINUTES) Recommendation Consider a resolution entitled “A Resolution of the City Council of the City of San Luis Obispo, California, in support of the goal of Senate Bill 562 (Lar a) to create The Healthy California Program to provide comprehensive, universal, single-payer health care coverage and a health care cost control system for the benefit of all residents of the State.” LIAISON REPORTS AND COMMUNICATIONS (Not to exceed 15 minutes) Council Members report on conferences or other City activities. At this time, any Council Member or the City Manager may ask a question for clarification, make an announcement, or report briefly on his or her activities. In addition, subject to Council Policies and Procedures, they may provide a reference to staff or other resources for factual information, request staff to report back to the Council at a subsequent meeting concerning any matter, or take action to direct staff to place a matter of business on a future agenda. (Gov. Code Sec. 54954.2) ADJOURNMENT The Regular City Council Meeting of July 4, 2017 was previously cancelled and rescheduled for Wednesday, July 5, 2017 at 4:30 p.m. and 6:00 p.m., in the Council Chamber, 990 Palm Street, San Luis Obispo, California. A subsequent meeting may be held on June 27, 2017 at 5:00 p.m., in the Council Chamber, 990 Palm Street, San Luis Obispo, California, regarding adoption of the 2017-19 Financial Plan and 2017-18 Budget, if necessary. Packet Pg 7 San Luis Obispo City Council Agenda June 20, 2017 Page 8 LISTENING ASSISTIVE DEVICES are available for the hearing impaired--please see City Clerk. The City of San Luis Obispo wishes to make all of its public meetings accessible to the public. Upon request, this agenda will be made available in appropriate alternative formats to persons with disabilities. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should direct such request to the City Clerk’s Office at (805) 781-7100 at least 48 hours before the meeting, if possible. Telecommunications Device for the Deaf (805) 781-7107. City Council regular meetings are televised live on Charter Channel 20. Agenda related writings or documents provided to the City Council are available for public inspection in the City Clerk’s Office located at 990 Palm Street, San Luis Obispo, California during normal business hours, and on the City’s website www.slocity.org. Persons with questions concerning any agenda item may call the City Clerk’s Office at (805) 781-7100. Packet Pg 8 San Luis Obispo Page 1 Tuesday, March 28, 2017 Special Meeting of the City Council CALL TO ORDER A Special Meeting of the San Luis Obispo City Council was called to order on Tuesday, March 28, 2017 at 9:03 a.m. at the Courtyard Marriott Irish Hills Room, located at 1605 Calle Joaquin, San Luis Obispo, California, by Mayor Harmon. ROLL CALL Council Members Present: Council Members Carlyn Christianson, Aaron Gomez, Andy Pease, Vice Mayor Dan Rivoire, and Mayor Heidi Harmon. Council Members Absent: None City Staff Present: Katie Lichtig, City Manager; Christine Dietrick, City Attorney; Derek Johnson, Assistant City Manager; Garret Olson, Fire Chief; Daryl Grigsby, Public Works Director; Monica Irons, Human Resources Director; Deanna Cantrell, Police Chief; Xenia Bradford, Interim Finance Director; Michael Codron, Community Development Director; Shelly Stanwyck, Parks and Recreation Director; and Carrie Mattingly, Utilities Director; were present at Roll Call. Other staff members presented reports or responded to questions as indicated in the minutes. Facilitator Present: Trudy Sopp, Centre for Organizational Effectiveness PUBLIC COMMENT ON AGENDA ITEMS ONLY None ---End of Public Comment--- A. WORKSHOP ON CITY VISION, CIVIC ENGAGEMENT / COMMUNITY INVOLVEMENT / OUTREACH, COUNCIL / STAFF RELATIONS / ROLES, AND COUNCIL WORKLOAD AND COMPENSATION FACILITATED BY TRUDY SOPP Packet Pg 9 4 San Luis Obispo City Council Workshop Minutes of March 28, 2017 Page 2 Vision of Council By consensus on the following Council Vision was approved: The Council believes SLO is a friendly, dynamic community embracing its future while respecting its past with core values of civility, sustainability, inclusivity and resiliency. Community Outreach/Civic Engagement/Agreeing Council agreed that there is a huge opportunity to market the successes and good work of city staff through social media by correcting misperceptions and educating the community. Additionally, the use of social media is an opportunity to humanize staff and city projects. There was consensus that as many social media platforms as feasible should be pursued, with Instagram being the highest priority. The philosophy should be “Show don't Tell”. The purpose of social media should be to “market” or brand the City to a different demographic to get educated and then give them opportunities to provide input on line and maybe that will inspire these folks to participate in a council meeting. Consolidate all social media pages and platforms to the maximum extent possible. Evaluate best practices about leaving some pages open for some limited group of community members like the skate park followers. Let the staff post Mistakes will be made and council will be supportive Consider interns who can drive posts Need to update the social media policy Clear filter Clear rules of engagement No comments for now Establish clear rules of when someone will be thrown off the page for when we do allow comments No consolidation of resources to facilitate is needed, however there is a need to evaluate how to achieve the outcome. Mayor Harmon will establish neighborhood walk and talks to stimulate engagement and will invite others to participate. Civil Discourse League of Women Voters - consensus to support the League of Women Voters’ "Democracy Concierge". Begin each meeting with the logistics and a welcome for newcomers, Mayor Harmon and Council Member Pease will work on this together with help from City Manage Lichtig. Packet Pg 10 4 San Luis Obispo City Council Workshop Minutes of March 28, 2017 Page 3 Info graphic of the anatomy of a Council Meeting is in the works. Direction provided to have a bin by the City Clerk for the public to place completed speaker slips. Council discussed ways to set the appropriate tone with those participants in the meeting that are being disruptive. Council/Staff Relations Evaluate if there are attachments that could be excluded (boilerplate contract) or placed in a reading file if it needs to be available. Look at sequencing of the items to make sure that longer items come earlier in the evening. Evaluate publishing the presentations on the website along with the CAR. Consider using more graphics in presentation. No need to cover everything in staff report. Constituent inquiries to Council only: Council Member Christianson usually forwards to staff with a note to the person that they are sending to staff. Can be confusing because staff could get from multiple Council Members but that is better than getting it from none. Constituent inquiries to Council email: Assistant City Manager Johnson or someone in Administration will acknowledge and ensure a response is sent to the member of the public and the Council. How to refer to the Mayor and Council Members: At the meetings use title and last name. This will be the practice for staff and the members of the public too. Outside meetings as casual as possible (first names are preferred). Council consensus to limit public comment on items not on the agenda to 15 minutes at the beginning of the meeting and drop any extra speakers to end of meeting. The Mayor will assess whether to seek council consensus to change amount of time each speaker will be allotted less time than traditional 3 minutes (3 minutes if 5 or less speakers, 2 minutes or 1 minute). Consensus that the amount of time should not be less than 1 minute. May need to update the Council Policies and Procedures Manual to reflect this practice. Council Compensation and Workload: After conversation about the duties and responsibilities that drive workload, there was Council consensus to thoroughly evaluate two options to address workload and compensation in the next review of council compensation: 1. Increase compensation to match the workload (which can be about 30 hours a week for Council and more than full-time for Mayor) 2. Decrease workload to match the compensation Packet Pg 11 4 San Luis Obispo City Council Workshop Minutes of March 28, 2017 Page 4 Process to review Council compensation should be expedited (sooner than is called for in the municipal code and/or Council Policies and Procedures Manual). ADJOURNMENT The next Regular City Council Meetings are scheduled for Tuesday, April 4, 2017 at 4:00 p.m. and 6:00 p.m., in the Council Chamber, 990 Palm Street, San Luis Obispo, California. __________________________ Carrie Gallagher City Clerk APPROVED BY COUNCIL: XX/XX/2017 Packet Pg 12 4 Meeting Date: 6/20/2017 FROM: Carrie Mattingly, Utilities Director Prepared By: Aaron Floyd, Utilities Deputy Director - Water Jennifer Metz, Utilities Projects Manager Mychal Boerman, Water Resources Program Manager SUBJECT: REVISED 2016 WATER RESOURCES STATUS REPORT RECOMMENDATION Receive and file the Revised 2016 Water Resources Status Report. DISCUSSION This report replaces the 2016 Water Resources Status Report received by Council on December 13, 2016 due to a calculation error. General Plan policy A5.2.3 states the reliability reserve will be calculated using 20 percent of current population. The prior report errantly used 20 percent the City’s urban reserve capacity population for the calculation. With the correction, the reliability reserve decreases from 1,499 to 1,209 acre-feet and secondary water supply increases from 3,114 to 3,404 acre-feet. The total water resource availability is unchanged. The 2016 Water Resources Status Report (Attachment A) provides an overview and update on the City's water resources. These reports have been provided to the City Council and community since 1985 and serve to both inform future policy decisions as well as provide historical documentation of water conditions. Similar to the 2015 Water Resources Status Report, the water year reporting period extends from October 1 through September 30. The water year is designated by the calendar year in which it ends. This report covers water year 2016. 2016 Water Year Summary Total Water Use: 4,730.53 acre feet Potable Water Use 4,528.61 acre feet Recycled Water Use 201.92 acre feet 2016 Population 46,117 residents Per Capita Demand Per Day (Potable Only) 87.67 gallons Water Projection Model (as of September 30, 2016) >5 years of supply Water Resource Availability: Salinas & Whale Rock Reservoirs (Safe Annual Yield) 6,940 acre feet Nacimiento Reservoir (Dependable Yield) 5,482 acre feet Recycled Water (from 2015) 187 acre feet Siltation (from 2010 to 2060) (500) acre feet Total Water Resource Availability: 12,109 acre feet Packet Pg 13 5 Water Supply Accounting: Primary Water Supply 1 7,496 acre feet Reliability Reserve 2 1,209 acre feet Secondary Water Supply 3 3,404 acre feet Total Water Supply: 12,109 acre feet NOTES: 1. Per General Plan policy A 5.2.2, primary water supply is the amount of water needed for General Plan build-out using the water use rate established by policy A 5.2.1 (117 gallons per capita per day). 2. Per General Plan policy A 5.2.3, reliability reserve that is 20-percent of the water use rate established in Policy A 5.2.1 multiplied by the City’s current population (46,117 in 2015). 3. Per General Plan policy A 5.2.4, secondary water supply is the remaining City water supply available after accounting for primary water supply and a reliability reserve. Water availability for 2016 is 12,109 acre feet, an increase of 2,124 acre feet over 2015 due to the full allocation of Nacimiento Reservoir and increased recycled water usage. Water supply accounting reflects the General Plan, Water and Wastewater Management Element Policies A 5.2.2 through A 5.2.4, adopted by the City Council in June 2016. Drought Update The statewide drought emergency continued during the 2016 Water Year, with the drought now into its fifth year (2011 to 2016). State drought regulations that began in 2014, were expanded in 2015, and continued through the 2016 Water Year. On May 9, 2016, the Governor issued an Executive Order that directed the State Water Resources Control Board to adjust and extend its emergency water conservation regulations through the end of January 2017 in recognition of the differing water supply conditions for many communities, and to develop proposed emergency water restrictions for 2017 if the drought persists. Following the Governor's Executive Order in April 2015, the State Water Board adopted mandatory statewide reductions with the City's required reduction at 12 percent. The community continues to do an outstanding job in reducing water consumption in response to the new regulations. The City is on target to meet State requirements, as shown in the table below, achieving an average 21 percent reduction in the 2016 Water Year over 2013 water usage. 2015 Water Year Reduction 2016 Water Year Reduction Total Water Year Reduction from 2013 Usage 16% 21% Notes: The reduction represents the total water reduction achieved in the Water Year from water usage in 2013. The City's mandatory 12 percent reduction went into effect in June 2015, so were not in place during the full 2015 Water Year. Data does not include recycled water. Source: City of San Luis Obispo, 2016. Efforts made by the City in 2016 to encourage water conservation through active outreach have included hosting a community water forum, offering rebates and free water saving fixtures, and Packet Pg 14 5 numerous site visits to assist concerned residents. The Governor's latest drought-related Executive Order (B-37-16) established a new water use efficiency framework for California by aiming to "Make Conservation a California Way of Life." The 2016 Executive Order bolsters the state's drought resilience and preparedness by establishing longer-term water conservation measures that include: Permanent monthly water use reporting, New urban water use targets, Reducing system water loss, Eliminating clearly wasteful practices, and Strengthening urban drought contingency plans. These updated measures aim to not only reduce immediate water use but to establish a long-term change in the way Californians think about water. Recycled Water Use of recycled water for irrigation and construction water totaled 201.92 acre feet for the 2016 Water Year, up from 168 acre feet in 2015. Approximately 17 acre feet of this usage was for construction water. A total of 44 construction water permits were sold during the 2015 -16 fiscal year, with 28 permits sold so far during the 2016-17 fiscal year. Corporation Yard Well As part of the overall water management strategy adopted by City Council in June 2015, the City's Corporation Yard well, located on Prado Road, was brought under a permit syste m. This change generated 40 permit users in 2015, with another 40 permits issued so far in 2016. The City Council will be considering eliminating access to the Corporation Yard Well at its June 20, 2017 meeting. Water Modeling The City uses two models to assist in water management. The first is the Water Projection Model which is used to assess the City's current water availability. This model was updated to include climate data from the 2012-14-time period to more accurately reflect the impacts of the drought. Based on this analysis, the model indicated the City has a greater than five-year supply of water. The second model used is the Safe Annual Yield Model. This model defines the annual amount of water available from Salinas and Whale Rock Reservoirs when operated in a coordinated manner. The current combined Safe Annual Yield for Salinas and Whale Rock Reservoirs is 6,940 acre feet per year. Since it is unknown how long the drought will last, model updates used hypothetical precipitation scenarios for the upcoming rain season. The results of these model runs showed that a relatively normal rainfall year would not impact the Safe Annual Yield; however, a continued drought will negatively impact the safe annual yield. This figure may need to be lowered after the upcoming winter rainfall if the Central Coast receives a less than normal amount of precipitation. Packet Pg 15 5 Water Resource Project Outlook for 2017 The City is updating the 2004 Water Reuse Master Plan which is scheduled to be complete in 2017. This plan will serve to inform the City as to the amount of recycled water that can be produced as well as the best utilization of this resource. The City is also reviewing the rate it charges for recycled water, which has been set at 90 percent of the City's potable rate since the program's inception. Staff will return to Council in March 2017 with the Sustainable Groundwater Management Act (SGMA). This new State law will initially require the formation of Groundwater Sustainability Agencies (GSAs) by June 2017. These GSAs will then work to create a plan to manage the groundwater resources of the San Luis Obispo basin. ENVIRONMENTAL REVIEW The Water Resource Status Report is not a "project" under the California Environmental Quality Act (CEQA), because the action does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378. CONCURRENCES Community Development concurs with the environmental review findings. FISCAL IMPACT There are no fiscal impacts associated with the recommended action. Attachments: a - Revised 2016 Water Resources Status Report Packet Pg 16 5 CITY OF SAN LUIS OBISPO 2016 Water Resources Status Report This Report Covers October 1, 2015 through September 30, 2016 Whale Rock Reservoir. 2016 Photo credit: City of San Luis Obispo REVISION 1: June 2017 The original report accepted by the City Council on December 13, 2016 included calculation errors for the Reliability Reserve and Secondary Water Supply – this revision corrects those errors. PREPARED BY: Jennifer Metz, Utilities Projects Manager Aaron Floyd, Utilities Deputy Director-Water Mychal Boerman, Water Resources Program Manager Packet Pg 17 5 City of San Luis Obispo 2016 Water Resources Status Report 2 Packet Pg 18 5 City of San Luis Obispo 2016 Water Resources Status Report 3 The City of San Luis Obispo 2016 Water Resources Status Report includes water production and water consumption data for October 1, 2015 through September 30, 2016 and was prepared in accordance with the General Plan, Water and Wastewater Management Element, Policy A5.3.1. The reporting period corresponds to the Water Year (October 1 through September 30), the 12-month period for which precipitation totals are measured. The water year is designated by the calendar year in which it ends. This report covers Water Year 2016. The Report is organized as follows: I. Drought Update II. Water Policy Update III. Water Supply IV. Water Demand V. Water Resource Availability VI. Water Supply Accounting VII. Water Demand Management I. DROUGHT UPDATE The statewide drought emergency continued during the 2016 Water Year, with the drought now into its fifth year during 2016. State drought regulations that began in 2014, were expanded in 2015, and continued through the 2016 Water Year. On May 9, 2016, the Governor issued an Executive Order that directed the State Water Resources Control Board to adjust and extend its emergency water conservation regulations through the end of January 2017 in recognition of the differing water supply conditions for many communities, and to develop proposed emergency water restrictions for 2017 if the drought persists. The Governor’s latest drought-related Executive Order (B-37-16) established a new water use efficiency framework for California by aiming to “Make Conservation a California Way of Life.” Packet Pg 19 5 City of San Luis Obispo 2016 Water Resources Status Report 4 The 2016 Executive Order bolsters the state’s drought resilience and preparedness by establishing longer- term water conservation measures that include: Permanent monthly water use reporting, New urban water use targets, Reducing system water loss, Eliminating clearly wasteful practices, and Strengthening urban drought contingency plans. These updated measures aim to not only reduce immediate water use but to establish a long-term change in the way Californians think about water. LOCAL RESPONSE The drought brought about unprecedented regulatory action from the State of California which required a mandatory 12 percent reduction in City water use when compared with 2013 water use. To comply with this mandate, the City Council adopted a drought response strategy in June 2015. This strategy is still in place and includes the following: Adoption of a resolution declaring a drought emergency; Adoption of a resolution to defer new landscape installation or the use of modified landscape plans during the drought emergency; Adoption of an ordinance amending Chapter 13.07 of the City’s Municipal Code to include two- day-a-week and time-of-day restrictions for outdoor watering; Approval of an incentive program for high efficiency toilets and washing machines; and Adoption of a resolution establishing a permit fee for the use of the Corporation Yard groundwater well. The community continues to do an outstanding job in reducing water consumption in response to the regulations. The City is on target to meet State requirements, as shown in the table below, achieving an average 21 percent reduction in the 2016 Water Year over 2013 water usage. 2015 Water Year Reduction 2016 Water Year Reduction Total Water Year Reduction from 2013 Usage 16% 21% Note: The reduction represents the total water reduction achieved in the Water Year from water usage in 2013. The City’s mandatory 12 percent reduction went into effect in June 2015, so were not in place during the full 2015 Water Year. Data does not include recycled water. Source: City of San Luis Obispo, 2016. Packet Pg 20 5 City of San Luis Obispo 2016 Water Resources Status Report 5 The City’s enforcement strategy has relied on active enforcement of water waste prohibitions, with a focus on providing information and resources to the public in order to encourage the correction of existing violations and to encourage voluntary compliance. During Water Year 2016, City staff issued 528 formal and informal violation notifications. Of the 528 violations recorded, only 55 were repeat violations with only 12 total properties being contacted more than two times throughout the course of the year. Violations throughout the year were predominantly related to issues with irrigation systems. 281 of the violations recorded were related to water runoff from irrigation systems while another 228 violations were due to irrigating on a prohibited day or during prohibited hours. The remaining 20 violations were related to issues such as watering within 48-hours of measurable rainfall, washing a vehicle without a shutoff nozzle, and using a hose to wash down a driveway or sidewalk. Given the strong relationship between irrigation and water waste violations, most violations occur during peak irrigation season (from May through October) and become nearly non-existent during winter months. As shown in the Violations Heat Map, there are several areas of town where violations occur most frequently. Given advanced reporting and tracking efforts, efforts are focused on areas of town with high likelihood of violations. When violations occur they are geocoded and permanently recorded with information such as type of violation, customer contact method, and outcome of contact. This recording of data helps track frequency of violation and if response to violations needs to be escalated due to repeated violations. Prohibited Day/Time 228 Water Runoff 281 Other Violations 20 Violation Types 280 Phone Calls 192 Door Tags 54 In- Person 2 Notice of Violations Issued Violation Response Methods Packet Pg 21 5 City of San Luis Obispo 2016 Water Resources Status Report 6 Water Waste Violations Heat Map Source: City of San Luis Obispo, 2016. The Water Waste Violations Heat Map shows locations in the City that experienced the highest number of water waste violations during the 2016 Water Year. These violations include watering within 48-hours of measurable rainfall, washing a vehicle without a shutoff nozzle, and using a hose to wash down a driveway or sidewalk. Packet Pg 22 5 City of San Luis Obispo 2016 Water Resources Status Report 7 II. WATER POLICY UPDATE The City’s guiding water policy document for water resource planning is the General Plan Water and Wastewater Management Element (WWME). The WWME was updated on June 16, 2016 along with the 2015 Urban Water Management Plan. As part of the 2016 update, the City changed the factor used in water supply accounting and demand projections to use the per capita potable water use rate allowed under Senate Bill X7-7 (Water Conservation Act of 2009) of 117 gallons per capita per day (gpcd). The updated policy language reads as follows: The City will utilize the per capita water use rate allowed by SB X7-7 for projecting future potable water demand established as 117 gallons per capita per day. Prior to this update, the City used a water use rate based on a 10-year running average of gpcd. Using 117 gpcd is a more conservative approach as a 10-year average can be influenced by drought years where the City can experience a significant reduction in potable water demand. In June of 2016, the City updated its Urban Water Management Plan. This update is required by the State of California Urban Water Management Planning Act to occur every five years. The preparation of the 2015 Urban Water Management Plan (2015 Plan) was unique in that it took place during unprecedented drought conditions statewide. As part of the 2015 Plan, changes were made to the City’s Water Shortage Contingency Plan. Water shortage contingency planning allows for the City to be prepared for and respond to water shortages such as a drought or a catastrophic supply interruption such as a break in a transmission pipeline. To provide more time to respond to water shortages, a six-staged demand management response was included in the plan with a “Monitoring” stage in place at all times. The update to the Water Shortage Contingency Plan in the 2015 Urban Water Management Plan includes implementation of mandatory water conservation measures when the City’s water supplies are projected to last five years or less. This change from the prior plan’s three year or less plan allows for more time to incrementally implement water shortage response strategies. The policy language is as follows: Mandatory water conservation measures as described in the City’s Water Shortage Contingency Plan will be implemented when the City's water supplies are projected to last five years or less. III. WATER SUPPLY Per WWME Policy A2.2.1, the City uses multiple water sources to meet its water supply needs. The city has four primary water supply sources including Whale Rock Reservoir, Salinas Reservoir, Nacimiento Reservoir, and recycled water (for landscape irrigation and construction water), with groundwater serving as a fifth supplemental source. The supply per source for Water Year 2016 (October 1, 2015 to September 30, 2016) is summarized below. City of San Luis Obispo Water Supply Sources Nacimiento Reservoir Whale Rock Reservoir Recycled Water Salinas Reservoir Groundwater Packet Pg 23 5 City of San Luis Obispo 2016 Water Resources Status Report 8 2016 City Water Supply by Source (Acre Feet) Nacimiento Reservoir Whale Rock Reservoir 2 Recycled Water Salinas Reservoir Groundwater 3 Total City Water Demand 3,834.5 685.92 201.92 8.19 0 4,730.53 81.06% 14.50% 4.27% 0.17% 0 % 100% Notes: 1. All Values are rounded. 2. Water delivered to Cal Poly State University is excluded from the City’s water demand. 3. Groundwater was not used for potable purposes during the 2016 Water Year. NACIMIENTO RESERVOIR Water deliveries to the City of San Luis Obispo from Nacimiento Reservoir began in January 2011. San Luis Obispo County operates and maintains the delivery of water from Nacimiento Reservoir to participating agencies (currently the cities of Paso Robles and San Luis Obispo, Atascadero Mutual Water Company, Templeton Community Services District, County Service Area 10A [Cayucos], Santa Margarita Ranch, and Bella Vista Mobile Home Park). The Nacimiento Project Commission provides oversight to project operations, maintenance, and the project budget. The Commission is made up of representatives from each of the four agencies’ governing boards and a County Representative who is a member of the County Board of Supervisors which also sits as the Board of Directors for the Flood Control District. In March 2016, the City Council approved the addition of 2,102 afy from Nacimiento Reservoir to the City’s secondary water supply, referred to as the “full allocation” of Nacimiento. This addition brought the City’s contractual right to Nacimiento Reservoir from 3,380 afy to 5,482 afy. The City uses secondary water supplies to meet short-term water supply losses due to events such as drought, pipeline maintenance, and repair of infrastructure. With uncertainty of future climatic conditions, regulation and aging infrastructure, the additional supply of water from Nacimiento Reservoir to the City’s portfolio reduces pressure on use of water supplies in Whale Rock and Salinas reservoirs serving to extend these stored supplies during future critical water shortage periods. Nacimiento Reservoir, 2016. Photo credit: City of San Luis Obispo. Packet Pg 24 5 City of San Luis Obispo 2016 Water Resources Status Report 9 Since the full allocation was approved in March 2016 and the budget amendment to cover the expense associated with the additional pumping costs was approved in June , the City has significantly increased the volume of water it utilized from Nacimiento to serve the community’s water demand. During the 2016 Water Year, over 81 percent of the City’s total water demand was met by Nacimiento Reservoir. The City utilized twice as much water from Nacimiento Reservoir during the 2016 Water Year than the prior year. SALINAS & WHALE ROCK RESERVOIRS Salinas and Whale Rock Reservoirs served as the City’s primary water supplies for over 50 years. The City pays the County of San Luis Obispo Flood Control and Water Conservation District (County) to provide oversight, operations, and maintenance of the Salinas Dam and related water delivery facilities. The City provides the oversight, operations, and maintenance of the Whale Rock Reservoir for the benefit of the Whale Rock Commission, a joint powers agency made up of Cal Poly State University, California Men’s Colony, and the City. During the 2016 Water Year, the City utilized a total of 694.11 acre feet from Salinas and Whale Rock reservoirs. RECYCLED WATER For the 2016 Water Year, the City delivered 202 acre feet of recycled water, up from 168 acre feet for the 2015 Water Year. The biggest increase in recycled water use during the 2016 Water Year was construction water. Total construction water use in the 2016 Water Year was 20 acre feet, up from 10 acre feet during the 2015 water year. The City has had a Construction Water Permit Program since 2010. 5,285 5,541 5,892 4,988 4,731 2,181 1,502 1,247 1,891 3,835 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 2012 2013 2014 2015 2016 Utilization of Water Supply from Nacimiento Reservoir Total City Water Demand (in acre feet)Acre Feet utilized from Nacimiento Reservoir Packet Pg 25 5 City of San Luis Obispo 2016 Water Resources Status Report 10 The design phase for the City’s Water Resource Recovery Facility (WRRF) Project is underway in 2016 which is planned to maximize recycled water production. The upgrade will enable the City to consider potable reuse, part of a One Water concept, in the future. The City is currently updating to the 2004 Water Reuse Master Plan which is scheduled to be complete in 2017. The City is also reviewing the rate it charges for recycled water, which has been set at 90 percent of the City’s potable rate since the program’s inception. GROUNDWATER The City transitioned from utilizing groundwater for potable purposes with the last withdrawal occurring in April 2015. The City’s groundwater wells remain in an operable, stand- by position should the use of groundwater be required . Other existing well casings are being revitalized to provide greater drought resiliency. The City is also working with a hydrogeologist to site a future well field for a potential groundwater program expansion and for sitin g of the withdrawal of highly treated wastewater for an indirect potable reuse system. With the emergency drought declaration in 2015, the City established a permit fee and procedures for use of the Corporation Yard groundwater well. The program was started in recognition of the drought and the importance of the groundwater resources and the management of this resource to community and others within the San Luis Groundwater Basin. During the 2016 water year, that permit program entered its second year and has 40 participants. Non-potable well water is also used at the Laguna Lake Golf Course for landscape irrigation. WATER MODELING The City performs water planning through the use of different models. The Water Projection Model, or Wet Water Model, is used to inform the amount of water the City has available during the water year. This model inputs include an annual one percent population increases, current total water demand (in gallons per capita per day), current levels of Salinas and Whale Rock Reservoir, contractual water received from Nacimiento Reservoir, and climate data associated with each reservoir in terms of lack of precipitation and increase in evaporation for the worst years of the drought (2012-14). These drought-year climate impacts are assumed for every year moving forward, even in more “normal” years such as 2015 and 2016. With this model, the City is able to analyze the effects of more severe climatic conditions, such as increased evaporation and decreased precipitation, in our stored water reservoirs. The upgrade of the Water Resource Recovery Facility will enable the City to consider potable reuse in the future, part of a One Water concept. Packet Pg 26 5 City of San Luis Obispo 2016 Water Resources Status Report 11 In March 2016, the model was updated to include the additional water supply from the full allocation of Nacimiento Reservoir. While the last model run shows the City having more than five years of available water, the uncertainty of when the drought will end and what impact future climate change may have still remain. IV. WATER DEMAND During Water Year 2016, over 63 percent of total water use in the City was to support single and multi-family residential uses. Historical water use is summarized below, as well as corresponding population, per capita use rate, and precipitation. The 2016 per capita water use was 91.6 gallons per capita per day (gpcd). Based on WWME policies, the City uses 117 gpcd to project water required to serve build- out population. Population, Water Use & Rainfall Year Population Total Water Use (acre feet) Per Capita (gpcd) Rainfall1,2,3 (inches) 2007 44,433 6,493 130.5 12.7 2008 44,579 6,359 127.3 18.1 2009 44,829 6,134 122.2 18.9 2010 44,948 5,489 109.0 36.0 2011 45,418 5,285 103.9 18.9 2012 45,308 5,541 109.2 21.5 2013 45,541 5,892 115.5 3.8 2014 45,473 5,524 108.5 14.2 2015 45,802 4,990 97.3 11.8 2016 46,117 4 4,731 91.6 17.8 Notes: 1. Rai nfa ll amou nts for 2005 –2012 cal endar year source: Cal Poly CIMIS W eather Statio n. 2. Rai nfa ll amou nt fo r calendar year 2013-2015: SLO Reservoir. 3. Data for 2007 through 2014 presents calendar year rainfall data. 2015 and 2016 rainfall data covers the Water Year (October through September). 4. http://www.dof.ca.gov/Forecasting/Demographics/Estimates/e -1/ 41.17% 22.41% 24.98% 6.73%4.31%0.40% Water Consumption by Land Use Type Single Family Multi Family Non-Residential Irrigation (Potable) Irrigation (Recycled)Construction Water (Recycled) Packet Pg 27 5 City of San Luis Obispo 2016 Water Resources Status Report 12 With the City’s multi-source water supply, its reservoirs are in different watersheds, therefore rainfall throughout San Luis Obispo County can benefit the City. Average rainfall at various sites within San Luis Obispo is described below. Location Annual Average Rainfall (in inches) 2016 Water Year Total Rainfall (in inches) Rock Butte 39 26.89 Hwy 46 and W 7 Mile Road in Cambria, CA 30 19.93 SLO Reservoir 25 17.80 Salinas Dam 23 13.46 Source: http://www.slocountywater.org/site/Water%20Resources/Data/maps/precipitation-real-time.htm V. WATER RESOURCE AVAILABILITY The following table summarizes the Water Resource Availability based on WWME Section 3. Water availability for 2016 is 12,109 acre feet, an increase of 2,124 acre feet over 2015 due to the full allocation of Nacimiento Reservoir and increased recycled water usage. 2016 Water Resource Availability Water Resource Acre Feet Description 2016 Increase Salinas & Whale Rock Reservoirs 6,940 Safe Annual Yield 1 - Nacimiento Reservoir 5,482 Dependable Yield 2 2,102 acre feet Recycled Water 187 2015 Annual Usage 3 22 acre feet Siltation from 2010 to 2060 (500) WWME Policy A 4.2.2 4 - 12,109 2016 Annual Availability 2,124 acre feet NOTES: 1. Safe Annual Yield determined from computer model, which accounts for siltation loss through 2010 (per WWME Policy A 4.2.1). 2. Dependable Yield is the contractual amount of water the City has rights to from Nacimiento Reservoir. 3. The quantity of recycled water included is the actual prior year’s recycled water usage (calendar year 2015) per WWME Policy A 7.2.2. 4. Reservoir siltation is a natural occurrence that reduces storage capacity over long periods, resulting in the reduction of safe annual yield. Source: City of San Luis Obispo, 2015. View of San Luis Obispo from Tassajara Peak. Packet Pg 28 5 City of San Luis Obispo 2016 Water Resources Status Report 13 VI. WATER SUPPLY ACCOUNTING Per WWME Section 5, the City accounts for water supplies necessary to meet three specific community needs: Primary water supply Reliability reserve Secondary water supply The City’s primary water supply is defined as the amount of water needed to serve the build-out population identified in the General Plan, Land Use Element (2014). Table 3 in the Land Use Element identifies an urban reserve capacity of 57,200 people. The quantity of water needed for the primary water supply is calculated per WWME Policy A 5.2.2, using 117 gallons per capita per day (gpcd). The reliability reserve provides a buffer for future unforeseen or unpredictable long-term impacts to the City’s water supply. The quantity of water for the reliability reserve is established using 20 percent of the existing City population (46,117, 2016 population) at 117 gpcd, thus the reliability reserve will increase over time as population increases. The reliability reserve concept is included in the City’s Charter (Section 909) which identifies that the water may not be used to serve future development, and is defined per WWME Policy A 5.2.3. The secondary water supply is the amount of water remaining from the City’s available water resources above those needed to meet the primary water supply and reliability reserve. The secondary supply is identified to meet peak water demand periods or short -term loss of City water supply sources, per WWME Policy A 5.2.4. Water supply accounting is summarized in the table below . 2016 Water Supply Accounting (acre feet) Total Primary Water Supply Reliability Reserve Secondary Water Supply 12,109 7,496 1,209 3,404 Primary Water Supply = 117 gpcd x City Build-out Population = 117 gpcd x 57,200 x 365 day/year x Acre-Ft/325,853 gal 7,496 Acre-Ft/year Reliability Reserve = 117 gpcd x 2015 City Population x 20% = 117 gpcd x 46,117 x 365 day/year x Acre-Ft/325,853 gal x 20% 1,209 Acre-Ft/year Secondary Water Supply = Current Annual Availability – Primary Water Supply – Reliability Reserve = 12,109 Acre-Ft/year A – 7,496 Acre- Ft/year – 1,209 Acre-Ft/year 3,404 Acre-Ft/year A 2016 Annual Availability Packet Pg 29 5 City of San Luis Obispo 2016 Water Resources Status Report 14 VII. WATER DEMAND MANAGEMENT The City’s water conservation program is an integral part of its overall water management strategy. In the late 1980’s, the City implemented effective water efficiency programs and policies that allowed for continued community growth and economic development during water- constrained periods. Through strong conservation efforts, the community has reduced its annual average per capita water use from over 180 gallons in 1987 to 91.6 for the 2016 Water Year. With the lack of local drought relief from El Nino, the City continued its message related to water conservation while much of the media was declaring the drought “over” due to high quantities of rainfall in the northern half of the state. Along with its continued face-to-face contact with customers, the City continued to implement water conservation rebate programs, school education programs, and increased public outreach related to the ongoing drought. The outreach program currently consists of messaging on the City’s so cial media platforms and website along with traditional printed media such as the quarterly Resource Newsletter. In order to reach all local demographics, City staff diversified outreach efforts by attending local events such as Farmers Market, the SLO Home Expo, the Disaster Preparedness Expo, and the Community Water Forum. Adding to traditional media outlets, staff was interviewed on local radio, advertised on broadcast media, and created a video explaining the history of the City’s water resource and conservation programs. Packet Pg 30 5 City of San Luis Obispo 2016 Water Resources Status Report 15 REGIONAL WATER RESOURCE PLANNING Beyond the involvement in the Nacimiento Water Project, the City continues to participate as a member of the Water Resources Advisory Council and Regional Water Management Group, which promotes collaborative, integrated management of water resources within San Luis Obispo County and provides policy recommendations to the County Board of Supervisors. In addition, the City participates in the regional water conservation group Partners in Water Conservation. The Sustainable Groundwater Management Act (SGMA) is a statewide policy that empowers local agencies to adopt groundwater management plans that relate to the needs and resources of their communities. In the future, the City sees groundwater continuing to play an important and useful role in the balancing of its overall water supply portfolio. Associated with SGMA is the requirement to form a Groundwater Sustainability Agency by mid-2017 and create a Groundwater Sustainability Plan by 2022. Packet Pg 31 5 Page intentionally left blank. Packet Pg 32 5 Meeting Date: 6/20/2017 FROM: Xenia Bradford, Interim Director of Finance Prepared By: Rico Pardo, Accounting Manager/Controller SUBJECT: RESOLUTION EXTENDING THE DELEGATION OF INVESTMENT AUTHORITY TO THE CITY TREASURER THROUGH THE 2017-18 FISCAL YEAR RECOMMENDATION Approve a resolution extending the delegation of investment authority to the City Treasurer through the 2017-18 Fiscal Year. Background The City Council has previously appointed the Director of Finance to serve concurrently as the City Treasurer and has delegated responsibility for making investment decisions on behalf of the City to the City Treasurer. Each quarter, the City Treasurer meets with the Investment Oversight Committee (IOC) to review the performance of the investment portfolio to ensure that the investments are managed in accordance with the City’s investment policy. To date, there have been no instances of non - compliance reported to the IOC. A copy of each quarterly investment report is also provided to the City Council for review at the time that it is prepared. The City currently uses an outside professional fund manager, Public Financial Management (PFM) to manage the City’s investments. PFM was selected through a competitive process and manages investments for public agencies throughout the United States. Staff reviewed the current Investment Management Plan to identify potential changes to the existing guidelines and none are being recommended., California Government Code Section 53607 states that the Council’s delegation of investment responsibility to the City Treasurer must be renewed on an annual basis. This report and the accompanying resolution are intended to provide the City Council with the opportunity to extend this delegation of responsibility through the end of the 2017-18 Fiscal Year. ENVIRONMENTAL REVIEW The requested is not a project as defined under the California Environmental Quality Act. Packet Pg 33 6 CONCURRENCES This recommendation is consistent with the City’s Investment Management Plan and California Government Code Section 53607. FISCAL IMPACT Delegating responsibility for making investment decisions to the City Treasurer does not create a fiscal impact, however the delegation of responsibility to the City Treasurer ensures that timely decisions will be made with regard to the City’s investment portfolio and taking into consideration the City’s operational needs to maintain adequate liquidity to support its ongoing operations. ALTERNATIVES 1. The delegation of responsibility could be made to another member of staff having adequ ate knowledge of the City’s investment needs and the requirements imposed by the California Government Code (CGC). 2. If the Council declined to delegate this responsibility, then it would become the responsibility of the full Council to make the investment decisions on behalf of the City as directed by Section 53607 of the CGC. This is not recommended as investment decisions must be timely made and must be consistent will all applicable policies and laws and investment decisions should be based on the advice and counsel of professional fund managers who are informed by complex analytical research and a current and through understanding of relevant financial markets. Attachments: a - Delegation of Duties Resolution Packet Pg 34 6 R _____ RESOLUTION NO. (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, EXTENDING THE DELEGATION OF INVESTMENT AUTHORITY TO THE CITY TREASURER THROUGH THE 2017-18 FISCAL YEAR WHEREAS, it is the policy of the City of San Luis Obispo for the Director of Finance to concurrently hold the position of City Treasurer; and WHEREAS, the City Council has previously delegated the responsibility for making investment decisions to the City Treasurer in accordance with California Government Code Section 53607; and wishes to extend the period of time for an additional year; and WHEREAS, the City Council has reviewed the outcome of the City Treasurer’s investment decisions and now desires to extend the delegation of investment authority to the 2017-18 Fiscal Year. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. The above recitals are true and correct. SECTION 2. The City Council hereby extends the delegation of duties related making investments on behalf of the City to the City Treasurer for the 2017-18 Fiscal Year. SECTION 3. The City Clerk shall cause a certified copy of this Resolution confirming the delegation of investment authority to be forwarded to the City Treasurer. Upon motion of ___________________________, seconded by ___________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this 20th day of June 2017. ____________________________________ Mayor Heidi Harmon ATTEST: Packet Pg 35 6 Resolution No. (2017 Series) Page 2 R _____ ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this 20th day of June 2017. ____________________________________ Carrie Gallagher City Clerk Packet Pg 36 6 Meeting Date: 6/20/2017 FROM: Michael Codron, Community Development Director Prepared By: Diane Dostalek, Senior Civil Engineer SUBJECT: APPROVAL OF THE FINAL MAP FOR TRACT 2928, 1321 OSOS STREET (TR 96-13) RECOMMENDATION Adopt a Resolution (Attachment F) approving the Final Map for Tract 2928 located at 1321 Osos Street, authorizing the Mayor to execute a Subdivision Agreement, and authorizing the Public Works Director to accept the subdivision improvements and release the securities. DISCUSSION Background Tract 2928 (TR 96-13) is located at 1321 Osos Street (Attachment A). This subdivision is commonly known as Pacific Courtyards. A vesting tentative map for Tract 2928 was approved by the City Council on June 10, 2014, by Resolution No. 10531 (2014 Series) (Attachment B). The tentative map (Attachment C) approved a one lot subdivision for the purposes of creating nine residential condominiums and up to eight commercial condominiums. Approving the Final Map The tentative map has an initial two-year life per Municipal Code Section 16.10.150. The subdivider requested and was granted a one-year time extension by the City, so this vesting tentative map had an expiration date of June 10, 2017. Even though the tentative map is expired, the subdivider met the requirements of “timely filing” per Section 66452.6(d) of the Subdivision Map Act, so the final map can be recorded without the need for additional map extensions or a new tentative map. Section 66452.6(d) states: “Once a timely filing is made, subsequent actions of the local agency, including, but not limited to, processing, approving, and recording, may lawfully occur after the date of expiration of the tentative map. Delivery to the county surveyor or city engineer shall be deemed a timely filing for purposes of this section.” The final map for Tract 2928 (Attachment D) is ready to be approved and recorded. Pursuant to Section 16.14.080 of the Municipal Code, the Public Works Director has determined that the final map is in substantial compliance with the tentative map and any approved modifications thereof. Section 66474.1 of the Subdivision Map Act states that “a Legislative body shall not deny approval of a final or parcel map if it has previously approved a tentative map for the proposed subdivision and if it finds that the final or parcel map is in substantial compliance with the previously approved tentative map.” The approval of a final map is considered a ministerial action. Appropriate securities were submitted prior to expiration of the tentative map to guarantee completion of the required subdivision improvements as shown in the Subdivision Agreement (Attachment E). The resolution approving the final map (Attachment F) also authorizes the Packet Pg 37 7 Mayor to sign the Subdivision Agreement requiring the Subdivider to complete the subdivision improvements. Subdivision Improvements The public improvements required for this subdivision consist of replacing curb, gutter, and sidewalk along the project’s three street frontages and connections to the City water and sewer mains. Most of the subdivision improvements are on-site private improvements, such as driveways, parking, drainage, and utility services, which will be privately owned and maintained. Because the subdivision improvements are minor in nature, are almost completed, and will not result in any increase in maintenance costs to the City, the resolution approving the final map also authorizes the Public Works Director to accept the public improvements, certify completion of the private improvements, and release the securities once the requirements for release are met. CONCURRENCES The Public Works Department concurs with the recommended action. ENVIRONMENTAL REVIEW Approval of the final map is statutorily exempt under the California Environmental Quality Act (CEQA) pursuant to Section 15268(b)(3) Ministerial Projects (approval of final subdivision maps) of Title 14 of the California Code of Regulations (State CEQA Guidelines). Therefore, no environmental review is required to approve the map. FISCAL IMPACT There is no financial impact to the City associated with approving the final map, and the public improvements to be constructed with this subdivision are minor in nature and will not result in an increase in maintenance costs. ALTERNATIVES Deny approval of the final map. Denying approval of the final map can apply if findings are made that the requirements or conditions of the tentative map have not been met or performed (Section 66473 of the Subdivision Map Act) or if findings are made that the final map is not in substantial compliance with the previously approved tentative map (Section 66474.1 of the Subdivision Map Act). Since the final map is in substantial compliance with the tentative map, Sections 66474.1 and 66473 of the Subdivision Map Act require that City Council approve the map. Therefore, denying approval of the final map is not a recommended alternative unless the required findings are made. Packet Pg 38 7 Attachments: a - Vicinity Map b - R10531 Approve Tentative Tract Map 2928 c - Tentative map d - Final Map e - Subdivision Agreement f - Draft Resolution Approving Final Map Packet Pg 39 7 Packet Pg 40 7 RESOLUTION NO 10531 (201.1 Sci ies) A RESOLUTION OF THE CITY OF SAN LUIS OBISPO APPROVING A LAND USE ELEDIENT MAP Ai11ENDMENT TO RECONFIGURE THE BOUNDARY BETWEEN THE OFFICE AND iNIEDIUM -HIGH DENSITY RESIDENTIAL DESIGNATIONS ON THE SiTE, VESTING TENTATIVE TRACT MAP NO 2928 TO CREATE 9 RESIDENTIAL AND UP TO 8 COIN MERCiAL CONDOMINIUMS AND AN ADDENDUM TO THE PREVIOUSLY APPROVED MITIGATED NEGATIVE DECLARATION, FOR PROPERTY LOCATED A 1' 1321 S 1327 OSOS STREET, GP /R /TR/ER 96 -13 WHEREAS, the Planning Commission conducted a public heating in the Council Chamber of City Hall 990 Palm Street San Luis Obispo California on April 9 2014 and recommended approval of the project and WHEREAS, the City Council of the City of San Luis Obispo conducted a public hearmg in the Council Chamber of City Hall 990 Palm Street San Luis Obispo California on June 10 2014 pursuant to a proceeding instituted undei application GP /R/TR /L "R96 -13 ivhssion Medical Partners LLC applicant and WHEREAS, notices of said public hearing were made at the time and in the manner required by law and WHEREAS, the Cav Council has considered the Mitigated Negative Declaration MND) of environmental impact that was previousIv approved by the Council on August 19 2008 along with the Addendum prepared to update the MND to be consistent with the current project as prepared by staff and reviewed by the Planning Commission and WHEREAS, the City Council has duly considered all evidence Hu ludmg the testimony of the applicant interested parties and the evaluation and recommendations by staff presented at said hearing NOW, THEREFORE, BE iT RESOLVED, by the City Council of the City of San Luis Obispo as follows SECTION 1 Environmental Determination The City Council adopted the project's Mitigated Negative Declaration on August 19 2008 which incorporates the following still relevant mitigation measures and monitoring programs into the project An Addendum to the MND was prepared for the current project (ER 96 -13) which demonstrates that no additional nutigation measures are required The City Council has reviewed and considered the information contained in this Addendum in its consideration of the project and finds that the preparation of a subsequent MND or EIR is not necessary based on the following Findings and subject to the tollowmg mitigation measures R 10531Packet Pg 41 7 Resolution No 10531 (2014 Series) Page 2 Findings 1 None of the circumstances included in Section 15162 which require a subsequent MND or EIR have occurred specifically 2 The project changes do not result in new environmental impacts 3 The circumstances under which the project is undertaken will not require major changes to the MND 4 The modified project does not require any substantive changes to previously approved mitigation measures Mnrgation Measures Air Quality 1 Temporary impacts from the project including but not limited to e%cavation and construction activities and vehicle emissions from heavy duty equipment have the potential to create dust and emissions that e,,ceed air quality standards for temporary and intermediate periods unless the following mitigation measures are incorporated a Construction vehicle speed at the work site must be limited to fifteen (15) miles per hour or less b Prior to any ground disturbance sufficient water must be applied to the area to be disturbed to prevent visible emissions from crossing the property line c Areas to be graded or excavated must be kept adequately wetted to prevent visible emissions from crossing the property line d Storage piles must be kept adequately wetted treated with a chemical dust suppressant or covered when material is not being added to or removed from the pile e Equipment must be washed down before moving from the property onto a paved public road and f Visible track -out on the paved public road must be cleaned using wet sweeping or a HEPA filter equipped vacuum device within twenty -four (24) hours Monitoring Program These conditions shall be noted on all project grading and building plans The applicant shall present evidence of a plan for complying with these requirements prior to issuance of a grading or building permit from the City The applicant shall provide the City with the name and telephone number of the person responsible for ensuring compliance with these requirements The Building Inspector and Public Works Inspectors shall conduct field monitoring Biological Resources 2 Trees identified by the Architectural Review Commission to be preserved shall be clearly marked on grading and construction plans The applicant shall submit a tree preservation agreement for review and approval by the Community Development Director The agreement shall be secured by a bond in the amount determined by the City Arbonst Packet Pg 42 7 Resolution No 10531 (2014 Series) Page 3 Momtormg Program Prior to the issuance of a grading permit the applicant shall submit the required tree preservation agreement and actively coordinate with the City Arbonst during construction Cultural Resources 3 If significant archaeological materials are discovered during grading and construction all construction activities that may damage those materials shall immediately cease The project sponsor shall then propose specific mitigation based on a qualified archaeologist's recommendations The Director shall approve approve with changes or reject the mitigation proposal (if found incomplete infeasible or unlikely to reduce adverse impacts to an acceptable level) If the proposal is approved the project sponsor shall implement mitigation to the satisfaction of the Director A copy of the archaeologist's recommendations and the Director's decision will be forwarded to the Cultural Heritage Committee If grading results in the uncovering of artifacts then standard mitigation would be followed Monitoring Program Requirements for cultural resource mitigation shall be clearly noted on all plans for project radmg and construction Hazards and Hazardous Materials 4 if further contamination is encountered with site grading activities then work shall cease until the City s Hazardous Material Coordinator has been notified and had the opportunity to consult with other affected parties and appropriate governmental agencies to determine any necessary ne\tsteps Monitoring Program The City s Hazardous Material Coordinator shall be the lead in reviewing any subsequent studies necessary and assuring that any related site clean -up has taken place SECTION 2 General Plan Amendment Approval with Finding S 8, Conditions The City Council finds and approves the General Plan Amendment included as part of City Application No GP /R 96 -13 which reconfigures the boundary between the Office and Medium - High Density Residential designations on the site for the properties located at 1321 R 1327 Osos Street as shown on the attached Exhibit A based on the following findings and subject to the following conditions Fmchiws I The proposed modification is a minor amendment to the Land Use Element Map because it is a boundary change only which retains the emsung Office and Medium -1 -ligh Density Residential designations for the site with the same relative proportions of the overall site area intact Packet Pg 43 7 Resolution No 10531 (2014 Series) Page 4 2 The proposed General Plan Amendment will not be detrimental to the health safety and welfare of those living and working in the vicinity since the proposed change to the City s map accommodates the planned redevelopment of the site with uses and improvements that will be compatible with other properties in the same block that are either designated Office or Mech a i -High Density Residential 3 On August 19 2008 the City Council adopted a Mitigated Negative Declaration (MND) which adequately addresses the potential significant environmental impacts of the proposed project The MIND along with the prepared Addendum adequately evaluate the potential environmental impacts associated with the current project Conditions 1 The I.and Use Element Map is hereby amended as shown in Exhibit A 2 The Community Development Director shall cause the change to be reflected in documents which are on display in City Hall and are available for public viewing and use SECTION 3 Vestine Tentative Tract Man No 2928 Approval with Findutes and Conditions The City Council does hereby approve application TR 96 -13 (County Map No 2928) based on the following findings and subject to the following conditions and noting certain code requirements i indines The design of the vesting tentative tract map is consistent with the General Plan because the proposed subdivision respects existing site constraints will incrementally add to the City s residential housing inventory result in condominium units that meet density standards and will be consistent with the density and development limits established by the Office (0) and Medium -High Density Residential with the Historical Perseveration overlay zoning district (R -3 -1- 1) 2 The site is physically suited for the proposed type of development allowed in the Office and R -3 -H zones since the site is generally flat surrounded by a mature of residential projects parking lots and off ice buildings 3 The design of the subdivision will not conflict with easements for access through (or use of property within) the proposed subdivision 4 The design of the vesting tentative tract map and proposed improvements are not likely to cause serious health problems substantial environmental damage or substantially and unavoidably injure fish or wildlife or their habitat because the site does not have any creeks or other potentially significant habitat areas for fish and wildlife 5 Tandem parking within the project is supported for the following reasons Packet Pg 44 7 Resolution No 10531 ( 201 4 Series) Page 5 a The City of San Luis Obispo encourages creative use of mfill development to provide opportunities for much needed workforce housing near the downtown to support adopted Housing Element policies and goals b The site is unusually configured and with building height limitations poses difficult building design constraints that would potentially result in fewer residential units if conventional side -by -side parking were insisted upon c The project site is located adjacent to the downtown core that will provide pedestrian access to many daily needs of the residents Therefore residents may be less dependent on use of their automobiles such that the inconvenience associated with tandem parking may be minimized 6 On August 19 2008 the City Council adopted a Mitigated Negative Declaration (tIV1ND) which adequately addresses the potential significant environmental impacts of the proposed project The MND along with the prepared Addendum adequately evaluate the potential environmental impacts associated with the current project Conditions 1 The subdivider shall prepare conditions covenants and restrictions (CC &R's) to be approved by the Community Development Director and the City Attornev prior to final map approval CC &R's shall contain the following provisions a Creation of a homeowners' association to enforce the CC &R's and provide for professional perpetual maintenance of all common areas including private dnveways drainage on -site sewer facilities parking lot areas walls and fences lighting and landscaping b Grant to the city the right to maintain common areas if the homeowners' association fails to perform and to assess the homeowners' association for etpenses incurred and the right of the city to inspect the site at mutually agreed times to assure conditions of CC &R's and final map are being met c No parking except in approved designated spaces d No outdoor storage of boats campers motorhomes or trailers nor long -term storage of inoperable vehicles f No outdoor storage by individual units except in designated storage areas g No change in City - required provisions of the CC &R's without prior City Attorney approval h Homeowners' association shall file with the City Clerk the names and addresses of all officers of the homeowners' association within 15 days of any change in officers of the association Packet Pg 45 7 Resolution No 10531 (2014 Series) Page 6 I Provision of appropriate "no parking" signs and red - curbing along interior roadways as required by the City Fire Department CC &R's shall not prohibit location of solar clothes drying facilities in private yards which are substantially screened from view k Prospective property owners and renters shall be notified of the project s provision of tandem parking Additionally, they shall be advised that they should ensure that the amount of on -site parking is adequate for their needs because they will not be able to obtain on- street parking permits for any additional parking needs The responsibility for the placement of the trash and recycling containers at the street on collection days will be the responsibility of the propertv owner s association The property owner s association shall coordinate with San Luis Garbage Company regarding the collection time and preferred location for the placement of trash and recycling containers to minimize the obstruction of the public right -of -way 2 As part of the encroachment permit for the proposed frontage improvements the applicant shall submit plans to address any changes made to on- street parking signage and striping to the approval of the City Engineer 3 The applicant shall pay in-lieu fees for the 19 off-site parking spaces that will be eliminated with development 4 Short term bicycle parking shall be provided in a minimum of two locations one for bicyclists entering from Osos Street and one for bicyclists entering from Morro Street 5 The details of the required lockable private storage areas (minimum of 200 cubic feet per unit) shall be to the review and approval of the Architectural Review Commission 6 The Community Development Director shall review the final map to determine that any necessary revisions that result from review and approval of the final project design by the Architectural Review Commission are in substantial conformance with the approved tentative map 7 The down sloping Morro Street driveway slope shall comply with City standard 2130 8 To ensure pedestrian safety the driveway e\us shall provide a minimum of ten (10) feet clear visibility to the sidewalk on both sides of the e%it unobstructed by building corners columns or other visual impediments The distance is measured behind the stop bar and two feet to the right of the centerline where a driver would be located in a stopped velucle 9 The Drainage Report shall address post - development water quality per City Standard 101 OB Details of the passive design concept proposed shall be discussed in an amended Packet Pg 46 7 Resolution No 10531 (2014 Series) Page 7 report and shown on plans submitted for final review by the Architectural Review Commission 10 New curb gutter and sidewalk will be required along the project frontage on Osos Street and Morro Street I I All wire utilities to the new units shall be underground No additional utility poles shall be set and no wires shall be extended across the proposed protect to serve adjacent properties 12 The subdivider shall dedicate a 10 wide public utility and street tree easement across the site frontage on Morro and Osos Streets Said easements shall be adjacent to and contiguous with all public right -of -way lines bordering the site 13 The subdivider shall provide individual electrical phone television natural gas and water service and related utility company meters to each unit to the approval of the affected utility company and the Public Works Director Sub - metering of the water services may be allowed upon request and with the approval of the Utilities Director 14 Pursuant to Government Code Section 66474 9(b) the subdivider shall defend indemnify and hold harmless the City and/or its agents officers and employees from any claim action or proceeding against the City and /or its agents officers or employees to attack set aside void or annul the approval by the City of this subdivision and all actions relating thereto, including but not limited to environmental review Code Requirements The following code tequoements are included for unfornianonal proposes only 7hey serve to gn e the applicant a genet al ilea of other Cuy i eguirements that will apply to the project This is not intended to be an erhausnve /tw as other requirements may be identrijied dining the plan check process Long and short -term bicycle parking shall be provided in accordance with City standards Bike lockers or interior space within each dwelling unit or accessory structure shall be provided for the storage of at least two bicycles per dwelling unit in addition one short term bicycle parking space shall be provided for guests of the residential units and a minimum of three long term parking spaces and two short term parking spaces shall be provided for the office uses All bicycle parking shall be located outside of the public right of way 2 Any easements including but not limited to provisions for all public and private utilities access drainage, common driveways and maintenance of the same shall be shown on the final map or recorded separately prior to snap recordation if applicable 3 A preliminary soils report is required in accordance with the Subdivision Map Act and the City of San Luis Obispo Subdivision Regulations at the time of final map submittal Packet Pg 47 7 Resolution No 10531 (2014 Series) Page 8 The report shall be referenced on the final map in accordance with the city s Subdivision Regulations and the Subdivision Map Act Upon motion of Council Member Carpenter seconded by Council Member Ashbaugh and on the following roll call vote AYES Council Members Ashbaugh Carpenter and Smith and Mayor Mar\ NOES None ABSENT None ABSTAINING Vice Mayor Christianson The foregoing resolution was adopted this 10`h day of June 2014 May r JaA Nlan 111 — ATTEST z- n APPROVED AS Ythnsune U City Attorney Packet Pg 48 7 Exhibit A General Plan Land Use Map Existing Land Use Proposed Land Use Medium-High Density Residential Office Resolution No. 10531 (2014 Series) Page 9 Packet Pg 49 7 Packet Pg 507 Packet Pg 517 § § § Packet Pg 527 Packet Pg 537 Packet Pg 547 1 SUBDIVISION AGREEMENT THIS AGREEMENT is dated this ______ day of ___________201___ by and between Mission Medical Patagona, L.P., a Delaware limited partnership, herein referred to as "Subdivider," and the CITY OF SAN LUIS OBISPO, herein referred to as the "City." RECITALS REFERENCE IS HEREBY MADE to that certain proposed subdivision of real property in the City of San Luis Obispo, County of San Luis Obispo, State of California, a description of which is shown on the Final Map of Tract 2928, City of San Luis Obispo, California, as approved by the City Council on the ____ day of ___________, 201___. The Subdivider desires that said Tract 2928 be accepted and approved as a Final Map pursuant to the Subdivision Regulations of the City of San Luis Obispo (Title 16 of the San Luis Obispo Municipal Code), and It is a condition of said regulations that the Subdivider agree to install the improvements as set forth on the plans therefore. TERMS AND CONDITIONS: In consideration of the foregoing, the Subdivider does hereby agree to construct and install the following subdivision improvements in accordance with said subdivision regulations, and in accordance with approved plans and specifications on file in the office of the City Engineer, City of San Luis Obispo, to wit: 1. CURB, GUTTERS AND SIDEWALKS 2. STREET BASE AND SURFACING 3. WATER and SEWER SERVICES 4. LANDSCAPING Packet Pg 55 7 2 5. DRAINAGE STRUCTURES 6. ELECTRIC, GAS, TELEPHONE AND CABLE TELEVISION: In addition to the inspection and approval of such facilities by the City, each public utility shall be required to file a letter stating that the developer has properly installed all facilities to be provided by him, and that the said utility is prepared to provide service to residents upon request. 7. ANY & ALL OTHER IMPROVEMENTS shown on plans or required by project approvals. All of the above facilities shall be installed in the locations designated and to the plans and specifications on file and approved by said City. The lines and grades for all of said improvements shall be established by the Subdivider in accordance with said approved plans and specifications. The Subdivider agrees that the work of installing the above improvements shall begin within thirty (30) days from the date of recording of the final map, and that the work shall be completed within twelve (12) months of said recording date, unless an extension has been granted by the City, provided that if completion of said work is delayed by acts of God or labor disputes resulting in strike action, the Subdivider shall have an additional period of time equivalent to such period of delay in which to complete such work. Any extension of time hereunder shall not operate to release the surety on the Improvement Security filed pursuant to this agreement. In this connection, the surety waives the provisions of Section 2819 of the Civil Code of the State of California. No building permits will be issued nor occupancy granted after the expiration date of the agreement until completion and acceptance of all subdivision improvements unless specifically approved by the City. Packet Pg 56 7 3 The Subdivider does also agree to comply with the conditions established by the City Council and has paid the necessary fees as indicated on the attached Exhibits 1 and 2. The restoration of lost section corners and retracement of section lines within the Subdivision shall be in accordance with Article 5, paragraph 8771 et seq., of the Professional Land Surveyors Act, Chapter 15 of the Business and Professions Code of the State of California. The Subdivider attaches hereto, as an integral part hereof, and as security for the performance of this agreement, an instrument of credit or bond approved by and in favor of the City of San Luis Obispo, and conditional upon the faithful performance of this agreement. Said instrument of credit or bond is in the amount of $120,700 which is the amount of the estimated cost of said improvements that remain to be completed from the original $347,000 of required improvements. Per Sec. 66499.7(d) of the Government Code of the State of California, a reduction in the performance security, is not, and shall not be deemed to be, an acceptance by the City of the completed improvements, and the risk of loss or damage to the improvements and the obligation to maintain the improvements shall remain the sole responsibility of the subdivider until all required public improvements have been accepted by the local agency and all other required improvements have been fully completed in accordance with the plans and specifications for the improvements. Subdivider agrees to remedy any defects in the improvements arising from faulty workmanship or materials or defective construction of said improvements occurring within twelve (12) months after final completion and acceptance thereof. In accordance with Packet Pg 57 7 4 Sections 66499.7 and 66499.9 of the Government Code of the State of California, upon final completion and acceptance of the work, City will retain a security in the amount of $34,700, which is 10% of the total estimated cost of subdivision improvements. That amount being deemed sufficient to guarantee faithful performance by the Subdivider of his obligation to remedy any defects in the improvements arising within a period of one year following the completion and acceptance thereof. As authorized by the City Council for Tract 2928, completion of the work shall be deemed to have occurred on the date of written notice from the Public Works Director stating that said improvements have been accepted and completed according to said plans and specifications, and any approved modifications thereto, and that the faithful performance security can be released. Neither periodic nor progress inspections or approvals shall bind the City to accept said improvements or waive any defects in the same or any breach of this agreement. “AS-BUILT” record drawings are to be submitted within four weeks of completion of construction and prior to City acceptance of the public improvements. If the Subdivider fails to complete the work within the prescribed time, the Subdivider agrees that City may, at its option, declare the instrument of credit or bond which has been posted by Subdivider to guarantee faithful performance, forfeited and utilize the proceeds to complete said improvements, or city may complete said improvements and recover the full cost and expense thereof from the Subdivider or his surety. The Subdivider has deposited with the City a labor and materials surety in the amount of 50% of the above described subdivision improvements $173,500 in accordance Packet Pg 58 7 5 with State law. Said Subdivider shall pay an inspection fee for City to inspect the installation of said subdivision improvements, and to verify that they have been completed in accordance with the plans and specifications. Title 16 of the San Luis Obispo Municipal Code, entitled "Subdivision," all plans and specifications on file with said City Engineer as a part of said Subdivision Map, and all other documents filed with the City by the Subdivider and approved by the City are hereby referred to for further particulars in interpreting and defining the obligations of the Subdivider under this agreement. Pursuant to Government Code Section 66474.9(b), the subdivider shall defend, indemnify and hold harmless the City and/or its agents, officers and employees from any claim, action or proceeding against the City and/or its agents, officers or employees to attack, set aside, void or annul, the approval by the City of this subdivision, and all actions relating thereto, including but not limited to environmental review (“Indemnified Claims”). The City shall promptly notify the subdivider of any Indemnified Claim upon being presented with the Indemnified Claim and City shall fully cooperate in the defense against an Indemnified Claim. It is understood and agreed by and between the Subdivider and the City hereto that this agreement shall bind the heirs, executors, administrators, successors and assigns of the respective Parties to this agreement. It is agreed that the Subdivider will furnish copies of the successful bidder's contract unit prices and total bid prices for all of the improvements herein referred to. Packet Pg 59 7 6 IN WITNESS WHEREOF, this agreement has been executed by: SUBDIVIDER Mission Medical Patagona, L.P. a Delaware limited partnership BY: Mission Patagona GP, LLC a Delaware limited liability company Its: General Partner By: _________________________________ Charles Braff, Manager CITY OF SAN LUIS OBISPO MAYOR Heidi Harmon ATTEST: CITY CLERK Carrie Gallagher Packet Pg 60 7 7 EXHIBIT 1 TRACT 2928 SUBDIVISION AGREEMENT 1. The Subdivider has deposited a monumentation guarantee in the amount of $1,800 to cover the installation of survey monuments in accordance with the approved map and payment for same. Said guarantee will be released to the Subdivider upon receipt by the City of a letter from the Engineer indicating that they have completed the work and have been paid. Subdivider shall adhere to the requirements of California Business and Professions Code Section 8771 with regards to monument conservation. 2. Park-in-lieu fees have been paid, as listed in the attached EXHIBIT 2. 3. Water and sewer impact fees shall be paid at time of building permits through the Community Development Department per the fee schedule in effect at that time. 4. Transportation impact fees shall be paid at time of building permits through the Community Development Department per the fee schedule in effect at that time. 5. The subdivider shall comply with all requirements of Council Resolution 10531 (2014 Series) approving the tentative map. Packet Pg 61 7 8 EXHIBIT 2 TRACT 2928 - FEE AND BOND LIST 1321 OSOS Amount Form Date Received Bond Release Status Bonds and Guarantees: Total Faithful Performance $120,700 XXX XXX Can be released upon City acceptance of improvements and deposit of one-year warranty surety. Labor & Materials (50% of total cost of improvements $173,500 XXX XXX Can be released 90 days after acceptance of improvements, if no claims. (Civil Code Section 8412) Monument Guarantee $1,800 CD or Letter of Credit XXX Can be released upon verification that monuments have been set and surveyor has been paid. 10% Warranty $34,700 To be collected prior to release of Faithful Performance Bond Can be released one-year after acceptance of improvements, if no defects. Fees: Map Check Fee $12,241 Check 3/25/16 Plan Check Fee To be collected with building permit Improvement Plan Inspection To be collected with encroachment permit Park In-Lieu Fee1 $41,382 XXX XXX Parking In-Lieu Fee1 $90,592 To be paid prior to occupancy Water Impact Fee1 To be collected with building permit Wastewater Impact Fee1 To be collected with building permit Transportation Impact Fee1 To be collected with building permit 1 All Impact Fees are adjusted annually (July 1) based on CPI. Credit given for demolished units. Packet Pg 62 7 R _____ RESOLUTION NO. (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING THE FINAL MAP FOR TRACT 2928 (1321 OSOS STREET, TR 96-13) WHEREAS, the City Council made certain findings concerning the vesting tentative map for Tract 2928, as prescribed in Resolution No. 10531 (2014 Series); and WHEREAS, all the requirements, conditions and mitigation measures of said Resolution No. 10531 (2014 Series) have been completed or appropriate securities are in place to guarantee their completion; and WHERAS, the subdivider met the requirements of “timely filing” per Section 66452.6(d) of the Subdivision Map Act prior to expiration of the tentative map; and WHEREAS, the subdivider was required to construct certain public and private subdivision improvements as a condition of Tract 2928, and the required public improvements are minor in nature and will not result in an increase in maintenance cost to the City; and WHEREAS, the required public and private subdivision improvements are almost completed. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. The final map for Tract 2928 is found to be in substantial compliance with the tentative map. SECTION 2. The Subdivision Agreement for Tract 2928 is approved and the Mayor is authorized to approve minor revisions to the agreement and execute the document. SECTION 3. Approval of the final map for Tract 2928 is hereby granted. SECTION 4. The Public Works Director is authorized to act on behalf of the City to accept the public improvements and certify completion of the private subdivision improvements for Tract 2928 once the improvements are completed to the satisfaction of the Public Works Director. SECTION 5. The Public Works Director is authorized to act on behalf of the City to release the securities once the requirements for release are met. SECTION 6. The Mayor and City staff are authorized to take action necessary to carry out the intent of this resolution. Packet Pg 63 7 Resolution No. (2017 Series) Page 2 R _____ Upon motion of _______________________, seconded by ________________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this ______ day of _______________ 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 64 7 Meeting Date: 6/20/2017 FROM: Shelly Stanwyck, Director of Parks and Recreation Prepared By: Melissa C. Mudgett, Parks and Recreation Manager SUBJECT: RESOLUTION AUTHORIZING PETSAFE® BARK FOR YOUR PARK™ GRANT PROGRAM APPLICATION RECOMMENDATION 1. As recommended by the Parks and Recreation Commission, adopt a Resolution (Attachment E) authorizing the application by the City for the Bark for Your ParkTM grant for a total amount not to exceed $25,000 for the design and construction of a new PetSafe® dog park within City limits. 2. Authorize the City Manager to take necessary action to include the project in the budget and Capital Improvement Program upon grant award. DISCUSSION The City’s Financial Management Manual Policy 740 requires that the City Council authorize the submittal of grant applications that are $5,000 or greater. The purpose of this item is to seek the City Council’s approval of the application and to authorize the City Manager to execute documents should the grant be awarded to the City. Background The Dog Off-Leash Area at Laguna Lake Park began many years ago as a pilot program and quickly evolved into a popular and consistently utilized recreation opportunity. Taking note of this community need, the Parks and Recreation Commission and City Council formally ado pted the area into the Park Master Plan in 2005. It is the only area of the City’s facilities and parks in which owners may allow their canines to be off-leash, running freely, and interacting with other dogs. Dog parks have grown in popularity throughout the country as more people have pets and are asking that communities provide these dog-friendly recreational opportunities. The City of San Luis Obispo is no exception. Currently, the City has an “off-leash” area at the Laguna Lake park but does not have a “fenced dog park”. The closest fenced dog park is located at El Chorro Regional Park (Highway 1 across from Cuesta College), which is approximately 4 miles outside of City limits and about 9 miles from the Laguna Lake park. Future Needs and Community Outreach Both Public Works and Parks and Recreation Department staff provide for the maintenance and operations of the dog “off-leash” area at Laguna Lake Park. In the 2015-17 Financial Plan, $50,000 was allocated to fund the most immediate maintenance needs of the Dog Off-Leash Area. To identify future needs, recently, the Parks and Recreation Department conducted a user Packet Pg 65 8 survey about the existing dog “off-leash” area. The survey is intended to solicit feedback from users that will help shape the current maintenance needs, as well as future improvements. As part of the survey, users were asked to prioritize future improvements to the area should funding become available (such as with grants or community donations). At this time, based on preliminary survey results user’s top priorities are as follows: While there may be potential for multiple park areas to establish a fenced dog park within the City, this initial effort has identified locations near the existing Laguna Lake Park designated dog “off-leash area” as the ideal location for the addition of a fenced dog park. Staff and the Parks and Recreation Commission (PRC) recommend pursuing this location for grant funding as the survey indicates general support for such a park, there is existing compatibility of use as the area is regularly visited by dogs and nearby residences, and formalizing a portion of the park into a fenced-in dog park would be less costly due to existing infrastructure (such as accessibility to public restrooms, parking and utilities). The following is a preliminary list of benefits of establishing such a fenced dog park at Laguna Lake Park: 1. Provides for defined, controlled area to allow dogs off leash (great for dog wanderers, bolters); 2. Allows for the separation of large and small dogs; 3. Keeps dogs away from water bodies that may be polluted; 4. Provides for defined area to apply all-weather material (e.g. woodchips); 5. Minimize potential conflicts within the existing off-leash area and uncontrolled dogs from entering other parts of the park (e.g. children’s play area or open space). 2017 PetSafe® Bark For Your Park™ Program In May 2017, staff received notification of the availability of a nationwide grant to fund the development and construction of a dog park in our community. The 2017 PetSafe® Bark For Your Park™ Program is committed to creating safe, off-leash areas for pets and their owners to enjoy for years to come. The PetSafe® Grant Program will award communities nationwide $25,000 to help build new dog parks. If awarded, PetSafe® grant funds, in an amount not-to- exceed $25,000, could be used to construct a fenced-in dog park at Laguna Lake Park. (Attachment A – Grant Rules) Packet Pg 66 8 The PetSafe® grant application deadline is June 30, 2017. Communities awarded the grant will be publicly announced in September 2017. The City of San Luis Obispo meets the grant eligibility requirements (Attachment A – Grant Rules). The Parks and Recreation Commission and staff request approval to seek grant funding and pursue a more shovel ready project at Laguna Lake Park which would entail the following steps. A project proposal to establish a fenced dog park at Laguna Lake Park and potential locations within the park is provided as Attachment B. ENVIRONMENTAL REVIEW The proposed project is exempt under the California Environmental Quality Act pursuant to 15301. Existing Facilities as the project consists of minor alteration of existing public involving negligible or no expansion of use. The project consists of minor structures and will not result in new uses as the amenities will support existing uses. CONCURRENCES The Parks and Recreation Commission met on June 7, 2017 and provided unanimous support for the PetSafe® Bark for Your ParkTM Grant application and terms as presented. (Attachment C – Draft PRC Meeting Minutes) Parks and Recreation and Public Works Parks Maintenance staff have been collaborating on the PetSafe® grant application and materials for the Laguna Lake Park dog “off-leash” area. Public Works Parks Maintenance staff hav e reviewed the terms of the grant application and concur that they are maintainable as identified. Through community Packet Pg 67 8 outreach efforts, local dog park advocates and park users have expressed support for an improved dog park area as indicated in the preliminary survey results. FISCAL IMPACT There is no fiscal impact in authorizing the PetSafe® grant application resolution. However, if grant funds are awarded, construction of the dog park must be completed no later than three years from the date of the grant announcement; completion estimated by September 2020. The Parks and Recreation Department will be required to comply with grant reporting and auditing requirements on funding usage. ALTERNATIVE Deny Grant Application. The City Council could deny the PetSafe® Bark for Your ParkTM Dog Park Grant application and direct staff to identify alternate funds for maintenance and/or construction of a new dog park. Staff does not recommend this alternative as funding for construction of a new dog park is not included in the 2017-19 Financial Plan and would be largely dependent upon private donations or sponsorships. Additionally, the grant funding will enhance staff’s ability (both in Public Works and Parks and Recreation Departments) to provide this unique recreational opportunity and meet a community need in a manner that is safe for both pets and their owners. Attachments: a - PetSafe Grant Rules b - Project Proposal Laguna Lake Park c - Draft PRC June 7 2017 Minutes d - SLO Land and Support Letter e - PetSafe Grant Auth Resolution Packet Pg 68 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules By applying for a PetSafe Bark for Your Park Grant, you accept and agree to be bound by these Official Grant Rules. Applicants further agree to be bound by the decisions made by the Sponsor, which are final and binding in all respects. The Sponsor reserves the right to disqualify Applicants and/or applications that do not comply with the Official Grant Rules. 1. No Purchase Necessary: No purchase necessary to apply. A purchase will not increase your Community’s chances of being awarded a Grant. 2. Sponsor: The PetSafe Bark for Your Park Grant Program (the “Grant” or the “Program”) is sponsored by Radio Systems Corporation, 10427 PetSafe Way, Knoxville, TN 37932 (the “Sponsor”). 3. Grants Awarded: The number and amount of Grants to be awarded by Sponsor may change each year based on the financial commitment available from the Sponsor. Sponsor reserves the right not to award any Grants in a given year. A Grant may include park equipment provided by Sponsor and/or a cash award, as determined by Sponsor. The total value of each Grant will include the value of any park equipment provided by Sponsor plus the amount of the cash award, if any. Each Grant request cannot exceed $25,000 in value. The Sponsor will not fund more than $275,000 in Grants per year, with the total amount of Grants, if any, funded in a given year to be at the sole discretion of the Sponsor. No Grant will exceed $25,000 in dog park equipment and/or cash. Grants will be awarded a minimum of one time per year, in September. 4. Eligibility: The Program is open only to Communities of the United States, District of Columbia, and Puerto Rico (each, a “Community” or interchangeably an “Applicant”). The term “Community” as used in these Official Grant Rules means (a) a county, city, municipality or other local governmental unit, legally organized, constituted and existing under state law (a “Local Government”) or (b) a non-profit, public benefit organization legally organized and existing under state law which has received tax-exempt status under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, and which manages or operates park facilities on behalf of a Packet Pg 69 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules Local Government or which owns, manages and/or operates park facilities which are open to the general public at no charge (an “Eligible Non-profit Organization”). When the word “you” is used in these Official Grant Rules, it means the Applicant. Employees, officers, directors, affiliates, licensees, distributors and fulfillment agencies of the Sponsor, and respective immediate family members (a spouse, sibling, parent, child or grandparent and the spouses of such persons) and other persons living in their same households are not eligible to participate in the Program. 5. Applying for a Grant: To be eligible to be selected for a Grant, a Community must agree to accept and be bound by these Official Grant Rules and must submit the following to the Sponsor with their application: an executive summary of the community dog park project to be funded which may include proposed budgets and plans, if available; a verification letter from the land owner where the current or proposed dog park will be built that confirms the availability of land for the project; and letter(s) from the city or county mayor, city manager, the director of parks and recreation, or other civic leader within the Community that document their support of the proposed dog park and their willingness to complete the project if the Community is chosen as a Grant recipient. letter from a Community official that agrees in writing to be bound by these Official Grant Rules. All submissions may be made to the Sponsor via the petsafe.net/barkforyourpark website. To be eligible for a Grant, a Community must meet the Community Eligibility Requirements set forth in paragraph 6(d) below in addition to the foregoing requirements and must otherwise comply with these Official Grant Rules. Previous Bark for Your Park Grant recipients are not eligible to apply for additional Grants for a period of three (3) years from their Grant announcement. Previous winners of the PetSafe Bark for Your Park Contest are not eligible to apply for Grants for a period of three years from their park opening. 6. Description of the Program: (a) Community Designation. Packet Pg 70 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules In the event multiple applications are submitted on behalf of overlapping or contiguous Communities or on behalf of multiple Eligible Non-profit Organizations which are in the same general geographic area or overlapping geographic areas (such as a city and a county or an Eligible Non-profit Organization and the city in which it is located), Sponsor, in its sole discretion, may elect to designate which of the nominated Communities will be considered for a Grant. (b) Grant Selections. Grants will be awarded on a combination of factors, including Need (location/presence of park or condition of existing park), Impact (dog population, number of existing parks and recreational pet opportunities), and Support (commitment to building/operating a public dog park or prior community efforts). Preference will be given to allocating Grants equally across the United States. Based on the applications received, this distribution model may be adjusted. Grant applications will be reviewed by the Sponsor. All decisions of the Sponsor will be final, binding and non-appealable. (c) Award of Grants. The Communities designated as Grant recipients will be awarded a Grant by Sponsor for use in development and construction of a dog park project in the Community, subject to compliance with these Official Grant Rules and satisfaction of all Community Eligibility Requirements. Grant recipients will be contacted directly by telephone and/or email and will then be posted on the Bark for Your Park website. Potential recipients who cannot be contacted within ten (10) business days following the selection process, despite best efforts, may be disqualified and another recipient may be selected. Grants will be publically announced and awarded in September and Grant funds must be used within 3 years of the announcement. (d) Community Eligibility Requirements. To be eligible to receive a Grant, each Community selected as a Grant recipient must: provide land for construction and operation of the dog park, the location and suitability of which are subject to Sponsor’s reasonable approval. provide a budget for the design and construction of the dog park project, which shall be subject to Sponsor’s reasonable approval. provide evidence of appropriation or availability of sufficient funds to complete construction of the dog park project in accordance with the proposed budget. Packet Pg 71 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules provide a budget for operation of the dog park, which shall be subject to Sponsor’s reasonable approval, and commit to maintain and operate the dog park for at least three (3) years from the date the dog park opens to the general public. make the dog park available for use by the general public at no charge, subject to reasonable rules and regulations concerning such use. agree to include Sponsor’s PetSafe brand name and logo in all materials related to the dog park. for each Community accepting a grant at the $25,000 level, agree to permanently include Sponsor’s PetSafe brand name in the name of the dog park. agree to install signage for the dog park that includes the Sponsor’s PetSafe brand name and logo, which shall be subject to Sponsor’s reasonable approval. coordinate the opening/reopening/unveiling of the dog park with Sponsor and participate in promotional activities related to the Program and the dog park as reasonably requested by Sponsor. 7. Use and Funding of Grants: Grants cannot be used to purchase land and must be used only for direct costs of development and construction of the dog park, such as design fees, permits, site preparation, construction services, building materials, installation of utilities, and other capital expenses related to development and construction of the dog park, which shall be set forth in a project budget and subject to Sponsor’s reasonable approval (the “Approved Expenses”). The grand opening or reopening of the dog park should take place no later than three years from the date of the Grant announcement, subject to weather and other factors beyond the Community’s control. Sponsor will not be responsible for delays in approvals, construction, planning, or other issues outside of Sponsor’s control. If the grand opening or reopening of the dog park has not occurred by three years from the date of the Grant announcement, the Community agrees to donate the Grant funds to animal shelters, animal welfare groups, animal rescue groups, or animal advocacy groups as decided by the Community’s Chief Executive Offer. 8. Advertising and Promotion: The Sponsor and each of its respective affiliates, distributors, licensees, suppliers and advertising/promotion agencies (collectively, the “Sponsor Affiliates”) shall, except to the extent prohibited by law, have the right Packet Pg 72 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules and permission to use each Applicant’s name as well as any and all portions of their application for advertising, promotion, trade and/or any other lawful purpose in any media or format now or hereafter known without further compensation, permission or notification. By applying, each Applicant grants such rights and permission and agrees to release Sponsor from any and all claims that any advertising produced, presented, and/or prepared by or on behalf of the Sponsor infringes upon the Applicant’s rights with regard to any portions or ideas contained in their application. Each Community grants such rights and permission and agrees to release Sponsor from any and all claims that any advertising produced, presented, and/or prepared by or on behalf of the Sponsor infringes upon the Community’s rights with regard to any portions or ideas submitted by the Community. 9. Privacy: The names of Communities may be announced publicly in connection with any application or Grant. Any information posted on Facebook will be subject to their respective privacy policies. 10. Limitation of Liability: The Sponsor and Sponsor Affiliates, and all of their respective officers, directors, employees, representatives, agents and affiliates, expressly disclaim, shall have no liability and shall be held harmless from and against any liability, loss, injury or death to any Community or any other party, including without limitation damage to personal or real property, due in whole or in part, directly or indirectly, by reason of the acceptance, possession, use or misuse of any Grant (including any travel or activity related thereto), such party’s participation or attempt to participate in this Program or ability or inability to upload or download any information in connection with participating in the Program, or any fraud, viruses or other events that compromise the integrity of the Program. Each Community further acknowledges that neither Sponsor, the Sponsor’s affiliates nor any of their respective officers, directors, employees, representatives and agents, has made or is in any manner responsible or liable for any warranty, representation or guarantee, expressed or implied, in fact or in law, relative to any right or Grant, including, but not limited to, the value, quality, condition or fitness of any Grant, other than the dollar amount of the Grant. All Grants are provided “as is” and Sponsor disclaims all warranties, whether express or implied with respect thereto. use of the Program web site is at each user's own risk. Each Community participating in this Program agrees to indemnify, release and hold sponsor and sponsor’s affiliates, including but not limited to Facebook, and all of their respective officers, directors, employees, representatives, agents and affiliates, harmless from any and all claims, damages, expenses, costs (including Packet Pg 73 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules attorney’s fees) and liabilities (including settlements) due to or arising out of or in any way related to their participation in this Program or their acceptance or use of any Grant. 11. Miscellaneous: (a) Taxes, if any, are the sole responsibility of each Grant recipient. SPONSOR RESERVES THE RIGHT TO PROSECUTE AND/OR SEEK DAMAGES FROM ANY PERSON(S) THAT DAMAGES OR UNDERMINES THE LEGITIMATE OPERATION OF THE PROGRAM TO THE FULLEST EXTENT PERMITTED BY LAW. (c) Sponsor reserves the right, without notice and at any time, to disqualify and remove the application of a Community who violates these Grant Rules. Sponsor has no obligation to correspond with persons regarding applications or disqualifications of any Community. (d) Sponsor reserves the right, without prior notice and at any time, to terminate the Program, in whole or in part, or modify or suspend the Program in any way, for any reason, including if Sponsor determines, in its sole discretion, that the Program is impaired or corrupted or that fraud or technical problems, failures or malfunctions have destroyed or undermined the proper integrity, and/or feasibility of the Program. (e) All issues and questions concerning the construction, validity, interpretation and enforceability of these Official Grant Rules or the rights and obligations of the participant or Sponsor in connection with the Grant shall be governed by and construed in accordance with the laws of the State of Tennessee without giving effect to any choice of law or conflict of law rules or provisions that would cause the application of any other state, provincial or federal laws. Exclusive jurisdiction and venue for any action arising out of or relating to the Grant shall be in the state or federal courts of record located in Knox County, Tennessee. By participating in this Program, each Community hereby agrees to submit to the exclusive jurisdiction and venue of such courts for all purposes in connection with these Official Grant Rules and the Program. (f) Sponsor shall not incur any liability to any Community for any losses or damages of any nature whatsoever incurred or suffered by a Force Majeure Event including but not limited to: acts of God (such as, but not limited to, fires, explosions, earthquakes, drought, tidal waves and floods), power outages, war, riot, commotion, strikes, or acts or threats of terrorism. (g) Sponsor has the sole right to decide all matters and disputes arising from this Program and all decisions of Sponsor are final, binding and unappealable. Packet Pg 74 8 The PetSafe® Bark for Your Park Grant Program - Official Grant Rules (h) VOID WHERE PROHIBITED BY LAW. (i) Community agrees that all installation of equipment included in a Grant award from the Sponsor is the sole responsibility of the Community. © 2017 Radio Systems Corporation. All Rights Reserved. Packet Pg 75 8 PROPOSAL TO ESTABLISH A FENCED DOG PARK AT LAGUNA LAKE PARK 1 VISION STATEMENT To establish a successful fenced dog park at Laguna Lake Park, which would include the creation of formal guidelines regarding the placement and management of a fenced dog park in the City of San Luis Obispo. INTRODUCTION Dog parks have grown in popularity throughout the country as more people have pets and are asking that communities provide recreational opportunities for them. The City of San Luis Obispo is no exception. Currently the City does not have any formal off-leash dog parks. The closest such park is found at the El Chorro Regional Park (a regional County of San Luis Obispo park located Highway 1 across from Cuesta College) approximately 4 miles from the closest city limits and about 9 miles from Laguna Lake Park. While there may be potential for multiple areas to establish off-leash dog parks within the City, this preliminary effort intends to focus its efforts on a portion of the existing ‘dog off-leash area’ located within the Laguna Lake Park. A couple of reasons for this focus, if there is general support for such a park, include time savings given that the area is already being used by dogs and existing compatibility with nearby residences, and formalizing a portion into a fenced-in dog park would be less costly due to existing infrastructure (e.g., within existing park, bathrooms, water, electricity, access road, etc.). WHY ESTABLISH A FENCED-IN DOG PARK? The following is a preliminary list of benefits of establishing such a dog park at Laguna Lake: 1. Minimize potential conflicts within the existing park and to surrounding uses as dog use is currently established; 2. Provides for defined, controlled area to allow dogs off leash (great for dog wanderers, bolters); 3. Allows for the separation of large and small dogs; 4. Keeps dogs away from water bodies that may be polluted; 5. Provides for defined area to apply all-weather material (e.g. bark chips, mulch, pea gravel, etc.); 6. Reduces number of uncontrolled dogs from entering other parts of the park (e.g. children’s playground and protected natural conservation areas). NEXT STEPS Initial steps may include the following: City Parks and Recreation and Public Works Parks Maintenance staff seek input from community park users to determine the best course of action to develop a Laguna Lake Fenced-In Dog Park Plan (Plan) that is consistent with existing regulations and plans, and determine which, if any, of these would need to be amended to support the creation of a fenced-in dog park; Work with staff to define the approval process with advisory and decision making bodies (Parks and Recreation Commission and City Council) which could include establishment of goals, create design parameters, identify construction and maintenance elements and responsibilities, identify rules of Park use; Packet Pg 76 8 PROPOSAL TO ESTABLISH A FENCED DOG PARK AT LAGUNA LAKE PARK 2 Identify funding and support opportunities; and potential limitations and liabilities; etc. City Council approval to seek grant funding. Outreach to interested parties to solicit: general support and/or interest in development of such a park; determine potential interest in establishing a volunteer group to help construct and/or help the City maintain such a facility; provide input on the Plan design; Prepare preliminary design alternatives for consideration to formalize such a fenced-in Dog Park at Laguna Lake. Find funding sources for construction and operations. EXHIBITS 1. Exhibit 1 – List of Dog Park Considerations a. provides an initial list of the major elements that will likely require additional consideration as the design phase begins 2. Exhibit 2 – Laguna Lake Park possible locations a. provides a possible location and preliminary design for a fenced-in dog park at Laguna Lake 3. Exhibit 3 – Local Dog Park Examples a. provides some pictures of various features that exist at the County’s Regional El Chorro Dog Park (Hwy 1 across from Cuesta College) and Vineyard Dog Park (Templeton) Packet Pg 77 8 Exhibit 1 – General List of Dog Park Elements Preliminary Considerations Size: The recommended minimum size for City dog parks is generally between ½ acre and one acre; the initially proposed area is about one acre. Buffer from Residential: the distance from the closest residences is about 1,200 feet. The existing dog off-leash area use along with this ample separation will minimize conflicts; furthermore, having a ‘dawn to dusk’ hours of operation will further minimize conflicts. Water Source: The existing dog area already has a source of potable water; new lines would need to be installed to create several new points within the fenced dog park. Parking: There is limited existing parking lots located at Laguna Lake Park. Consideration of ADA requirements from parking area designs. Drainage: It is important that the site be relatively flat and have permeable soils; the suggested area is generally flat and gently sloping towards the lake; the soils are mostly clay and not very permeable (all of the soil within Laguna Lake area is not very permeable); all-weather material would likely be needed to make the area useable year round. Shade: Dog parks should include some shade as desirable, but not heavily shaded to allow for grass growth (if used as ground cover) and for the ground to dry; the proposed area includes a couple of trees, but many could be planted to achieve this objective (Plan could include a ‘memorial tree’ program to allow individuals to pay for such plantings). Use Conflict Avoidance: Guidelines should include avoiding play areas and other recreational amenities, high use areas, natural areas and water sources, wildlife, trails, community gardens, and historic sites; proposed area would not conflict with any of these activities or resources. Protect Wildlife and Natural Areas: Portions of Laguna Lake include sensitive plants and animals; the initial area being suggested appears to have only non-native annual grasses; an in- season survey may be needed to confirm that no sensitive resources within proposed area. Design Fence Height and Material: To be determined. Common examples include galvanized or vinyl coated chain link fences, with a minimum height of 4 feet. Double gated entries to allow for dog owners to unleash the dogs in a corral prior to letting the dog run free are the norm; service gates should be added to allow flatbed size trucks entry for maintenance/operations; El Chorro Park fence is made up of wooden posts and top rail with wire mesh buried into the ground (sized so tennis balls will not escape). Surfacing: To be determined. There may be multiple surface types including crusher fines or decomposed granite around the entrance area, concrete, grass, and mulch. For the larger areas, to minimize water use, mulch or bark may be the most likely material; ADA will likely require concrete walkways. Each type of material will have different maintenance requirements. Separate Small and Large Dog Areas: Initial proposal includes separated areas. Site Furniture and Other Amenities: Likely amenities could include benches, community bulletin board, a shade structure, storage building(s) (especially if volunteer group established to help on operational maintenance), trash containers and bag holders. Signage: Signage could include one or more of the following: entry signs, rule signs, etc.. ADA Access: Any design will need to comply with ADA regulations for access to the site. Management Packet Pg 78 8 Exhibit 1 – General List of Dog Park Elements Staffing: Laguna Lake Park is already staffed by City personnel (Public Works Parks Maintenance), and there is an existing dog area already in use. Once built, there may be a moderate increase in use, but should not require additional staff for daily use. As there will be new infrastructure, there may be a slight increase in maintenance activities. Having a controlled area for dogs to run may reduce rangers or other park staff needing to cite illegal off-leash activity outside of the dog park, or make it much clearer to users where off leash use is allowed. Fines: The existing citation program within the Laguna Lake Park would not change. Entry Fees: No fees are collected to use the Park and none would be proposed unless there is consensus that such fees should be collected for construction/operation costs. Hours of Operation: park operation hours are dawn to dusk per City Ordinance. Use Permit: To help offset construction and/or maintenance costs, a dog park permit (maybe as part of purchasing a county dog license?) could be required. Volunteers: To be determined. Volunteers could be involved with the park’s construction and/or maintenance and activity programming. Involvement of community members may increase acceptance of the dog park and help to minimize problems. High probability that such resources could be available. Packet Pg 79 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park LAGUNA LAKE PARK FENCED-IN DOG PARK PROPOSAL EXISTING LOCATION OF DOG-OFF LEASH AREA Existing Off- Leash Area (Un-Fenced) Public Restrooms & Parking Packet Pg 80 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS El Chorro Regional Dog Park (4 Miles Outside of City Limits) Shade, Signage and Designated Entrance Packet Pg 81 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Dog Park Signage Info Kiosk Packet Pg 82 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS All Weather Surface of Fenced Area. Shaded. Packet Pg 83 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Vineyard Dog Park - Templeton (22 miles Outside of City Limits) Dog Park Signage Packet Pg 84 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS All Weather Surface & ADA Accessible Pathway Packet Pg 85 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Kiosk & Shade Structure Packet Pg 86 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Public Art: Dog Park Amenities Packet Pg 87 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Sponsorship Plaques Packet Pg 88 8 EXHIBIT 3 – VARIOUS FEATURE OF COUNTY REGIONAL DOG PARKS Water Amenities: Doggie Pool Packet Pg 89 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park Packet Pg 90 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park Laguna Lake Dog Off-Leash Area: Photographs Packet Pg 91 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park Fenced-In Dog Park Options: Potential Locations of a Fenced-in Dog Park adjacent to ‘Off-Leash” Open Space Area” OPTION ‘A’ OPTION ‘B’ OPTION ‘C’ OPTION A: Adjacent to existing off-leash area. Proximity to parking and restrooms. Corner of Dalidio & Laguna Lake Park Loop OPTION B: Extends along Laguna Lake Park Loop, adjacent to Parking lot #2. Near to “off-leash” area. Next to Community Playground and Public Restrooms. OPTION C: Corner of Dalidio near Memorial tree grove. Across of Parking lot #3. Packet Pg 92 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park OPTION A OPTION ‘A’ Packet Pg 93 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park OPTION B OPTION ‘B’ Packet Pg 94 8 EXHIBIT 2 – Possible Location of Fenced-In Dog Park OPTION C OPTION ‘C’ OPTION ‘C’ Packet Pg 95 8 Minutes - DRAFT PARKS AND RECREATION COMMISSION 7 June 2017 Regular Meeting of the Advisory Body Committee Commission CALL TO ORDER A Regular Meeting of the Parks and Recreation Commission was called to order on the 7th day of June 2017 at 5:34 p.m. in the Parks and Recreation Administration Conference Room located at 1341 Nipomo Street, San Luis Obispo, California, by Chair Avakian. ROLL CALL Present: Chair Greg Avakian, Vice Chair Rodney Thurman, and Commissioners Susan Olson, Keri Schwab and Jeff Whitener Absent: Commissioner Single Staff: Parks and Recreation Director Shelly Stanwyck, Recreation Manager Melissa Mudgett PUBLIC COMMENT ON ITEMS NOT ON THE AGENDA None CONSENT AGENDA AND CONSIDERATION OF MINUTES ACTION: APPROVE THE REGULAR MEETING MINUTES OF MAY 3, 2017, MOTION BY COMMISSIONER WHITENER, SECOND BY COMMISSIONER THURMAN. 1. Consideration of Minutes CARRIED 5:0:0:1 to approve the amended minutes of the Parks and Recreation Advisory Body for the meeting of 5/3/2017. AYES: AVAKIAN, OLSON, SCHWAB, THURMAN, WHITENER NOES: NONE ABSTAIN: NONE ABSENT: SINGLE PUBLIC HEARINGS AND BUSINESS ITEMS 2. Review and Adopt Proposed Recreation Partnership Agreement Between the City of San Luis Obispo and Central Coast Soccer. Staff Melissa Mudgett presented an overview of the proposed recreational partnership agreement between the Parks and Recreation Sports program and Central Coast Soccer (CC Soccer) to offer adult soccer league programming at Damon Garcia Sports Fields. CC Soccer has been providing adult soccer opportunities, with the support of the City, since 2008. The proposed agreement memorializes the long-standing relationship and provides for improved Packet Pg 96 8 DRAFT Minutes – Parks and Recreation Commission Meeting of June 7, 2017 Page 2 liability management through standardized trainings and collection of liability waivers. Staff Mudgett also added the proposed agreement is in alignment with adopted cost recovery policies for adult recreational activities. She elaborated that the proposed agreement has the support of CC Soccer, Parks and Recreation and Public Works Parks Maintenance staff, whom maintain the sports fields. Public Comment Tim Townley, Vice President of CC Soccer, explained the adult soccer league program for the Commissioners. Mr. Townley said that the soccer league is non-competitive and changes teams every two months. CC Soccer provides additional assistance to the City, such as turning on-off fields lights, which reduces the impact to City staff. Mr. Townley expressed CC Soccer’s desire to continue to partner with the City. He said he was h opeful that the new kikuyu grass will improve field conditions and allow for more play. He concluded that he appreciated the Commission and Parks and Recreation Department staff and their support in this program. Gary Havas, SLO Resident, said he was supportive of the new kikuyu grass and is was nice to see strong partnerships like this between the City and recreational groups. Commission Comments followed. Commissioner Whitener said he was supportive of the proposed agreement and that CC Soccer has been a good partner for the City. Commissioner Olson was in support of the one-year terms to reassess field conditions annually. Vice Chair Thurman asked about the timeframe of the kikuyu grass renovation. Director Stanwyck responded that is it expected to take the summer growing season. She added that kikuyu grass is at the golf course and its growth responds well to recycled water. Director Stanwyck concluded that the City will know how the grass responds after the first playing season and if play can be expanded. Chair Avakian asked if the 30% ratio of registration fees collected by CC Soccer is adequate. Staff Mudgett responded that the revenue share equates to full (100%) cost recovery for the City, although less teams this first year will mean less revenues received by the City. ACTION: BY RECOMMEND TO THE CITY COUNCIL THAT IS ADOPT A RECREATION PARTNERSHIP AGREEMENT BETWEEN THE CITY OF SAN LUIS OBISPO AND CENTRAL COST SOCCER, MOTION BY COMMISSIONER WHITENER, SECOND BY COMMISSIONER SCHWAB. CARRIED 5:0:0:1 to Recommend the City Council adopt a Recreation Partnership Agreement between the City and Central Coast Soccer to provide an Adult Recreational Soccer League program. AYES: AVAKIAN, OLSON, SCHWAB, THURMAN, WHITENER NOES: NONE ABSTAIN: NONE ABSENT: SINGLE Packet Pg 97 8 DRAFT Minutes – Parks and Recreation Commission Meeting of June 7, 2017 Page 3 3. Receive Preliminary Dog Off-Leash Survey Results and Consider a Recommendation to Council that it Authorize staff to Pursue PetSAfe Bark for Your Park Grant. Staff Mudgett provided a brief background of the Laguna Lake Dog Off-Leash Area. She said that currently the City has an “off-leash” area at the Laguna Lake park but does not have an enclosed “fenced” dog park. The closest fenced dog park is located at El Chorro Regional Park (Highway 1 across from Cuesta College). Staff Mudgett provided an update of current maintenance activities at the “off-leash” area. Staff Mudgett added that a recent community survey was conducted to identify future needs of the “off-leash” area. The survey was intended to solicit feedback from users to help shape current maintenance needs, as well as future improvements to the area should funding become available (such as with grants or community donations). Preliminary survey results identified top priorities to be all-surface material and other amenities, such as a shade structure. Staff Mudgett responded that overall, the users are happy with the “off-leash” area’s maintenance and do not wish to completely enclose it; however, users were in support of adding a fenced-in dog park at another location within the park. Staff Mudgett presented on the benefits of an enclosed dog park and added that a nationwide grant to fund construction of a dog park is being offered through PetSafe, Bark for your Park program. Through the user survey and collaboration with Parks Maintenance staff, potential locations were identified at the Laguna Lake Park for a “fenced” dog park. Parks and Recreation staff requested the Commission’s approval to seek grant funding and pursue a more shovel ready project at Laguna Lake Park and to provide feedback on these potential locations. Staff Mudgett said that, should the City be awarded the dog park grant, there would be significant public outreach efforts and staff would return to the Commission for direction regarding public engagement, preliminary design, estimated project costs and construction progress. Public Comment Bill Hallum, SLO resident and daily “off-leash” area user, as the Commission to consider a broader policy and develop a City plan for dog parks. Mr. Hallum asked the Commission to consider a more robust more discussion about dog park needs before seeking a grant. He commended staff for their responsiveness to users. He expressed apprehension that he would hate to be locked into a dog park “location” as a result of this grant opportunity. Gary Havas, SLO Resident and former Parks and Recreation Commissioner, commented that it had been a long time since an enclosed “fenced” dog park has been sought and he appreciated staff efforts. He would like to see more dog parks within the City and expressed his support for pursing the dog park grant. Commission Comments followed. Commissioners Olson, Thurman and Avakian were concerned if the PetSafe grant “locked” the City into deciding a “fenced” dog park location in advance of more study and design efforts. Director Stanwyck confirmed the dog park grant was restrictive to city-owned land only and did not “lock” the city into a location should that change in the future. Staff Mudgett added that, should the city be awarded the grant, funds would need to be expended within three (3) years of award. Packet Pg 98 8 DRAFT Minutes – Parks and Recreation Commission Meeting of June 7, 2017 Page 4 Commissioner Olson expressed dissatisfaction with woodchips as an all-surface material for dog parks and it is damaging to dog paws, preferring grass. She asked about the standard “fenced” dog park size. Staff Mudgett responded that a typical dog park is .5 to 1 acre. Commissioner Olson asked if receiving grant funds would preclude the City from applying for future grants. Director Stanwyck did not believe this would have an impact on the City’s competition for other grants. Commissioner Schwab asked if other City Parks were considered. Staff Mudgett responded that five potential city park locations were identified, however preliminary survey results showed Laguna Lake Park as the top selection by survey takers. Director Stanwyck added that having an enclosed “fenced” dog park at this location would be consistent with other uses. Director Stanwyck provided additional information about Council’s support for an update of Parks and Recreation Element and Master Plan as part of the 2017-19 Financial Plan and future dog park planning and long-term visioning would be a part of that future policy document and plan. Vice Chair Thurman asked if it made sense to have both a “fenced” and unfenced dog area together. He was in support of more community analysis and incorporating dog park planning into the Parks and Recreation Element update. Commissioner Whitener as about the total cost of constructing a dog park. Staff Mudgett said that, in collaboration with Parks Maintenance staff, it believed a dog park could be constructed at this location for approximately $40,000 which assumes community donations of some materials, in-kind services, volunteer efforts, and partnerships. Commissioner Whitener was in support of the Laguna Park as a location for a “fenced” dog park. He was not in support of a “fenced” dog park at another City park location if it took away from, or negatively impacted, current uses. Chair Avakian said he is a dog lover and past dog owner who often frequented the Laguna Lake dog “off-leash” area. He supported the concept of a new dog park that had a large/small dog separation. He appreciated knowing that the grant had flexibility in determining the exact location of a “fenced” dog park. Chair Avakian asked if the area adjacent to the restrooms was considered as a potential location. Director Stanwyck responded that area could encroach into sensitive open space area and trails, and therefore was not recommended by staff. ACTION: RECEIVE PRELIMINARY DOG OFF-LEASH SURVEY RESULTS AND RECOMMEND TO COUNCIL THAT IT AUTHORIZE STAFF TO PURSUE PETSAFE® BARK FOR YOUR PARK™ GRANT, MOTION BY COMMISSIONER OLSON, SECOND BY WHITENER. CARRIED 3:2:0:1 to recommend to Council that it authorize staff to pursue a Bark for Your ParkTM grant application submitted to PetSafe®for a total amount not to exceed $25,000 for the design and construction of a new dog park at Laguna Lake Park. AYES: AVAKIAN, OLSON, WHITENER NOES: SCHWAB, THURMAN ABSTAIN: NONE ABSENT: SINGLE COMMITTEE COMMUNICATIONS Packet Pg 99 8 DRAFT Minutes – Parks and Recreation Commission Meeting of June 7, 2017 Page 5 4. Director’s Report Director Stanwyck provided a brief update of current Parks and Recreation programming and City updates. Council preliminarily included an update to the Parks and Recreation Element as part of the Preliminary 2017-19 Financial Plan. Next steps will be adoption of budget on June 20th. Following that staff will return to the PRC with to focus on identifying new and creative ways to engage the public (who recreate and who do not) in this process as well as to develop a project plan. Community Development planner, Rebecca Gershow, will be assisting with this effort. Council provided clarifying direction to staff regarding the continued pursuit of a park in the north of Broad Street neighborhood. Public Art Olas Portola installation on Friday, June 9th. Dedication planned for early August. Strategic Plan Summit, sharing five months of subcommittee results on the six Department Goals. There will be a presentation and annual report for the Commission. Summer Planning frenzy! Summer Camps start on June 19th with 150 kids daily. Recreation Swim starts June 12th. Jr Ranger Camp starts June 12th. Swim lessons provided to over 1,000 patrons. Golf program, “Free for Kids” w/ paying adult - all summer. Blues Games are under way. Friday Night Skate at the SLO Skate Park with music. Cancellation of August meeting and community whiffle-ball concept on agenda forecast. Sinshiemer Park Playground construction updates. Construction severely delayed by rain, but hopeful it will be completed before the SLO triathlon in July. PixOnPeaks 2.0 Campaign launched June 1st and includes seven new “loop” hikes LIAISON REPORTS 5. Subcommittee Liaison Reports Adult and Senior Programming: Commissioner Single was absent. No Report. Bicycle Advisory Committee: Commissioner Olson said the BAC had its annual traffic safety report; lowest collisions on record for auto, bike related accidents up 12% (56 collisions). Half of severe injuries are due to speeding and DUIs. The BAC has not yet concluded if it will lead the pedestrian plan. BAC will revisit at next meeting in July. City Facilities (Damon Garcia, Golf, Pool & Joint Use Facilities): Chair Avakian reported on the new pool ambassador program. Facility staff hosts have new polo shirt uniforms. The Golf Course has had 26,000 rounds played to-date. Golf Course added a Super Twilight rate. Tree Committee: Vice Chair Thurman said there was no Tree Committee report. Jack House Committee: Commissioner Whitener said the Jack House meeting was a synopsis on past, present and future of the Jack House. Most of the art is off the walls and awaiting analysis and cataloging and preservation (as most are in various states of deterioration). City staff is working with the groups for future Recreational Partnership agreements, implementation of operational best practices for historic homes managing and training for volunteers. The Jack House is now a Blue Star Museum, which allows military and their families a free tour of the home from Memorial Day to Labor Day. Youth Sports: Commissioner Schwab said there was no YSA meeting. Commission Communications Packet Pg 100 8 DRAFT Minutes – Parks and Recreation Commission Meeting of June 7, 2017 Page 6 Vice Chair Thurman corrected the pronunciation of “Sinsheimer” as “Sins-Heimer”. Commissioner Olson shared there is a group called “See Spot Run” that is dedicating efforts towards the City allowing a dedicate spot or trail in open space to hike with dogs off-leash. Director Stanwyck added that the City is starting a new program called “Hikes with Hounds”, which is a monthly Ranger led hike in the open space in June, July and August. ADJOURNMENT The meeting adjourned at 7:11 p.m. to the regular Parks and Recreation Commission scheduled for 05, July 2017 at 5:30 p.m., in the Parks and Recreation Department Conference Room located at 1341 Nipomo Street, San Luis Obispo, California. APPROVED BY THE PARKS AND RECREATION COMMISSION: 07/05/2017 Packet Pg 101 8 City of San Luis Obispo, Office of the City Manager, 990 Palm Street, San Luis Obispo, CA, 93401-3249, 805.781.7114, slocity.org June 20, 2017 PetSafe® Bark for Your Park Committee Radio Systems Corporation 10427 PetSafe Way Knoxville, Tennessee 37932 Subject: City of San Luis Obispo Grant Application - Land and Support Letter Dear PetSafe Bark for Your Park Committee, Thank you for your consideration in this unique grant opportunity. I am pleased to announce my support for our community’s participation in the 2017 Bark for Your Park™ grant program, with efforts to build, enhance and maintain the first ever dog park for the City of San Luis Obispo (SLO). As you are aware, dog parks have grown in popularity throughout the country as more people have pets and are asking that communities provide these dog-friendly recreational opportunities. The beautiful coastal City of SLO is no exception. Currently the City has one defacto “off-leash” area where dogs are permitted to roam off-leash without citation but does not have a “fenced dog park” within City limits (the closest fenced dog park being 4 miles outside of City limits). To identify future needs, the Parks and Recreation Department recently conducted a user survey to solicit feedback to help shape the current maintenance needs, as well as future improvements. As part of this survey, users were asked to prioritize future improvements and potential dog park locations should funding become available (such as with the PetSafe grant or community donations). Through this initial effort, the City-owned Laguna Lake Park (located at 504 Madonna Road, San Luis Obispo, California) was identified as an ideal location for the addition of a fenced dog park due to the community’s preliminary support for such a dog park, current compatibility of uses and existing park infrastructure (such as accessibility to public restrooms, parking and utilities). The City believes that following benefits will result from establishing such a fenced dog park at Laguna Lake Park: 1. Providing a defined, controlled area to allow dogs off leash (great for dog wanderers, bolters); 2. Allowing for the separation of large and small dogs; 3. Keeping dogs away from water bodies (compliant with Environmental Health Standards); 4. Providing a defined area to apply all-weather surface material (e.g. woodchips); Packet Pg 102 8 5. Reduces number of uncontrolled dogs from entering other parts of the park (e.g. children’s play area or natural conservation habitats). By way of this letter, the City of SLO and its community members pledge support for the future construction of a fenced dog park within City limits. Should our community be selected as recipient of a PetSafe grant, the City agrees to commit resources to support the construction, operation and maintenance of the dog park or help our citizens organize such efforts once the park is complete. In conclusion, the City of San Luis Obispo acknowledges and agrees to abide by the 2017 Bark for Your Park™ official grant rules. Respectfully, Katie Lichtig City Manager and Dog Owner Packet Pg 103 8 R ______ RESOLUTION NO. _____ (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, AUTHORIZING THE PARKS AND RECREATION DIRECTOR, OR THEIR DESIGNEE, TO EXECUTE AND FULFILL ANY RELATED PETSAFE® BARK FOR YOUR PARK™ GRANT APPLICATIONS, CERTIFICATIONS, ASSURANCES, FORMS, AGREEMENTS, AND ASSOCIATED DOCUMENTS ON BEHALF OF THE CITY WHEREAS, City of San Luis Obispo Parks and Recreation Department and Public Works Department operates, programs and maintains city parks; and WHEREAS, the City of San Luis Obispo (City) does not have a fenced-in dog park within city limits; and WHEREAS, the City is an eligible applicant for the 2017 PetSafe® Bark for Your Park™ grant program; and WHEREAS, the City, through a recent community outreach survey, has identified the City-owned Laguna Lake Park as the ideal location for the construction of a future PetSafe® dog park; and WHEREAS, the City acknowledges and agrees to abide by the 2017 Bark for Your Park ™ Official Grant Rules. WHEREAS, the City support for our community’s participation in the 2017 Bark for Your Park ™ grant program, with efforts to build, enhance and maintain the first ever dog park for the City of SLO. WHEREAS, if awarded a grant, the City agrees to commit resources to support the operation and maintenance of the dog park or help our citizens organize such efforts once the park is complete; and NOW, THEREFORE, BE IT RESOLVED that the City if San Luis Obispo City Council does hereby authorize the Parks and Recreation Director, or their Designee, to execute and fulfill any related PetSafe® Bark for Your Park™ program grant applications, certifications, assurances, forms, agreements, and associated documents on behalf of the City. Upon motion of _______________________, seconded by _______________________, and on the following roll call vote: AYES: NOES: ABSENT: Packet Pg 104 8 Resolution No. _____ (2017 Series) Page 2 The foregoing resolution was adopted this _____ day of _____________________ 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 105 8 Page intentionally left blank. Packet Pg 106 8 Meeting Date: 6/20/2017 FROM: Michael Codron, Community Development Director Prepared By: David Watson, Contract Planner Diane Dostalek, Senior Civil Engineer SUBJECT: APPROVAL OF A REIMBURSEMENT AGREEMENT WITH AMBIENT COMMUNITIES FOR OFFSITE AND OVERSIZED PUBLIC IMPROVEMENTS ASSOCIATED WITH ORCUTT AREA SPECIFIC PLAN DEVELOPMENT PROJECTS RECOMMENDATION Adopt a resolution approving a Reimbursement Agreement (Attachment C) for the construction of specific public improvements by Ambient Communities that benefit other Orcutt Area Specific Plan (OASP) property owners, authorize the Mayor to execute said Agreement, and authorize the Public Works Director to implement said Agreement. REPORT IN BRIEF Ambient Communities, the developer of the Righetti Ranch, Jones, Imel and Pratt(1) subdivisions is conditioned to construct numerous public improvements in order to develop their property. As the first developer coming forward in the OASP, Ambient is bearing an upfront share of the cost to construct the backbone infrastructure that serves other benefiting properties in the OASP. When a developer is required to construct offsite or oversized improvements, Section 16.20.110 of the San Luis Obispo Municipal Code allows the developer to request a reimbursement agreement with the City to identify those benefitting properties and seek future reimbursements from them for these improvement costs. As those other properties develop, the City will attempt to collect a prorated share of the cost of the improvements and then use those funds to reimburse the original developer who fronted the costs. A reimbursement agreement and an estimate of the costs allocated to each benefitting property is being presented to Council for approval. These reimbursable costs are estimates and will not be collected until documentation of final costs are provided by Ambient. Pursuant to the Municipal Code, reimbursements shall be made only when the city collects money from the developers of new projects and failure or error by the city resulting in funds not being collected will not subject the city to any liability, obligation or debt owed the original developer. The reimbursement agreement expires in 15 years. The affected property owners have been notified of the proposed reimbursement agreement. Packet Pg 107 9 DISCUSSION Background Ambient Communities has secured various rights of development including Vesting Tentative and Final Tract Map approvals for the construction of residential communities within the OASP area. They have acquired four projects in the area commonly referred to as “Righetti Ranch”, “Jones”, “Imel” and “Pratt(1)”. Ambient is undergoing final map review and approval, public and private infrastructure improvement plan review, and construction. See Attachment A for a vicinity map. As a part of the various approvals noted, Ambient Communities has been conditioned to complete a host of public infrastructure projects, including roadways, parks, pedestrian and bicycle paths, water and wastewater utilities, extension of recycled water services and other improvements to serve this developing neighborhood. These improvements are needed for the orderly development of the OASP area, and are consistent with the 2010 OASP, Final EIR and Public Facilities Financing Plans approved by City Council as a “blueprint” for development in this area. Since Ambient’s developments are “first in” and being constructed prior to other projects in the OASP area, Ambient has the burden of providing considerable backbone infrastructure to this area. Portions of this infrastructure also benefit and serve other future developments outside of the Ambient projects. Section 16.20.110 of the City’s Municipal Code provides for the possibility of reimbursement “Whenever improvements are required to be installed adjacent to property other than that being developed or in greater size or capacity than that required for the development of the property under consideration.” Infrastructure Financing An integral part of the OASP is a Public Facilities Financing Plan (PFFP) that outlines a strategy for the timely completion of public infrastructure and private improvements to serve the developing neighborhoods. The heart of the OASP PFFP strategy is based upon a “pay-as-you- go” philosophy rather than issuing debt to fund infrastructure, which is designed to balance the cost of mitigating infrastructure with the financial resources available from each new development. This strategy includes three (3) funding mechanisms to support implementation of these improvements: 1. An OASP PFFP Impact Fee that is collected from each development project to fund shared responsibility improvements consisting of backbone roadways, parks, pedestrian and bicycle paths that benefit all properties within the OASP; 2. Direct developer funding to complete project specific public and private infrastructure that is integrated into the overall improvements network but not needed for other development to occur; and, Packet Pg 108 9 3. In some cases, “first in” private developer advance financing of both PFFP and private infrastructure improvements that are to the partial or exclusive benefit of other OASP property owners. In the case of improvements completed by Ambient that benefit other property owners within the OASP, under their conditions of approval a “Reimbursement Agreement” can be pursued to ensure a “fair share” contribution back to Ambient is provided by those benefitting owners when they elect to develop their properties. Coordination of timing and cost-sharing arrangements for these improvements is particularly challenging. That challenge is a result of the lack of certainty regarding which property owners within the OASP may wish to pursue development of their respective properties, and how each property “fits into the whole” of the OASP infrastructure network. This “phasing” of infrastructure facility improvements was anticipated in the OASP and PFFP plans, and is essentially being taken to the next level of detailed implementation by this proposed Reimbursement Agreement action. Specific Proposals by Ambient Communities In the case of Ambient Communities, their initial phases include development of the Righetti Ranch, Jones and Imel properties. Infrastructure planning and engineering review has been active since their first subdivisions were approved in 2015. City approval of their final map and improvement plans is nearing completion. To meet their project conditions, and work within the PFFP “pay-as-you-go” philosophy, Ambient proposes the following financing plan to complete initial infrastructure investments: 1. Ambient will complete PFFP-identified roadway, parks and pathway infrastructure improvements as part of their initial construction. Impact fee credits will be made available to Ambient for the costs of these improvements applied to their share of the PFFP Impact Fees otherwise du e at building permit issuance; and 2. Reimbursements to Ambient from available PFFP impact funds paid by other OASP developments will occur as fees are collected and after prior obligations are retired. Said prior obligations include an existing reimbursement agreement approved by City Council on November 15, 2005, with Orcutt Associates, LLC for advancing roadway improvements to widen Orcutt Road from two to four lanes across the Union Pacific Railroad crossing and construct improvements at the intersection of Laurel Lane; and 3. For those eligible public infrastructure improvements not covered by the OASP PFFP, such as water, sewer and certain roadways, a “Reimbursement Agreement” that would allow the City to collect reimbursable costs from other benefitting owners when they choose to develop their land. Evaluation of Proposed Ambient Communities “Reimbursement Agreement” City staff worked with Ambient Communities to develop a Reimbursement Agreement (RA) subject to criteria established in the City Municipal Code. Ambient provided the supporting documentation identifying which infrastructure projects constructed by Ambient were outside the Packet Pg 109 9 PFFP and, in their view, benefitted other OASP property owners in whole or in part. Ambient also provided estimates of costs for the design, permitting and construction of this infrastructure, along with their initial take on how the costs of these improvements would be allocated to the other OASP properties. Over the past several months, staff has worked closely with Ambient to refine both the scope of these public infrastructure projects and the “fair share” allocation of benefit to other OASP properties. The result is a draft Resolution (Attachment B) and Reimbursement Agreement (Attachment C) for Council approval. Various components of the Reimbursement Agreement are summarized below. “Excess Public Improvements” This terminology has been used in the RA to identify those public improvements that are not otherwise covered by the PFFP infrastructure facility improvement program, and that could be subject to reimbursement from other OASP properties. Exhibit “A” of the RA is a summary of the eight (8) Excess Public Improvements that Ambient proposes to build “up front” with their projects and seeks partial reimbursements from the other owners as they develop their properties. The Excess Public Improvements are graphically shown on Attachment D of this agenda report. The benefitting properties and their respective densities and allocated infrastructure projects are noted graphically in Exhibit “B” of the RA. These improvements include off-site water main extensions to the OASP area (Projects 1a and 1b), internal public water mains, recycled water lines and sanitary sewer mains (Projects 2, 3 and 4) that would be constructed under roadways built by Ambient but that would connect to other properties (done to avoid having to cut open and repave the streets if these improvements were otherwise deferred) and Orcutt frontage road improvements (Projects 6a, 6b and 7). RA Term Pursuant to the SLO Municipal Code, the term of this RA will last 15 years. At the end of this term, the Agreement would expire and no further rights to reimbursement would be available to Ambient. Exhibit “A” Costs Are Estimates, to be Confirmed After Completion of Construction The estimates of costs for each of the eight (8) projects were developed by Ambient. The RA provides that following the completion of each eligible improvement, Ambient will provide proof of reimbursable costs and the City will be exclusively responsible for determining the final reimbursable costs for each improvement. The Director of Public Works will be empowered to implement the RA on behalf of the City. Decisions of the Director on reimbursable amounts will be considered final. Packet Pg 110 9 Bids to be Provided by Ambient Prior to Construction As a means of “checks and balances”, bids will be solicited by Ambient and submitted for review by the City prior to commencing construction of the Excess Public Improvements. This clause is intended to provide some assurance that the reimbursable costs listed on Exhibit “A” to the RA are reasonable, and that Ambient has secured non-collusive bids for the work. If there is significant variation between the bids secured by Ambient and their en gineer’s estimates as reflected in Exhibit “A,” revisions to Exhibit “A” will be considered by the Director and finalized prior to commencing construction on the reimbursement-eligible projects (Paragraph 8c). Collection of Reimbursements (Timing and Allocation per Unit) Reimbursement from benefitting properties will occur on a per unit basis through collection of reimbursable costs. The per-unit reimbursable amount is identified on Exhibit “A” of the RA and is based on the OASP densities established for each benefitting owner, except for the Taylor/Muick subdivision. The new owner of that particular subdivision is proposing to construct less units than originally planned, so Exhibit “A” has been revised to reflect their newly proposed unit count. Section 11 of the RA states that the City shall attempt to collect reimbursements from benefitting properties prior to the earlier of Final Map recordation or building permit issuance of the benefitting property, provided that the Excess Public Improvement is completed and all required documentation is submitted to verify the cost of the improvement. In the event that a benefitting owner elects to develop their property at lower density, Ambient may request that the City revise Exhibit “A” of the RA to redistribute the shortfall to other benefitting properties that have not yet developed. There is nothing in the RA that requires the City to revise Exhibit “A” and the City has indicated to Ambient that it will consider revisions to Exhibit “A” only sparingly. In the case where revisions are warranted, such as when the actual cost of the improvements varies significantly from the estimated cost or when a benefitting property develops a significantly more or less number of units than originally planned, then Section 4 of the RA gives the Public Works Director ultimate authority to determine any deviations from Exhibit “A”. City to be Reimbursed for Costs to Implement RA Ambient will reimburse the City for its costs to determine the reimbursable amount per Section 9 of the RA. Indemnification The City will be indemnified, defended and held harmless by Ambient for implementing this Agreement and will bear no cost or liability if it fails to collect funds or reimbursable costs from the benefitting properties. Packet Pg 111 9 Public Outreach Staff contacted all the affected property owners either by email or letter notifying them of the impending reimbursement agreement and the impacts on each property owner. As of June 8, 2017, staff has received input or questions from three property owners: Paul Fiala, Beverly Pratt and Andy Mangano of SLO Orcutt LLC (the developer of the Taylor/Muick subdivision Tract 3044). Mr. Fiala wanted confirmation that if he didn’t develop his property, then he wouldn’t have to pay any reimbursements. That assumption was confirmed by City staff. He also wanted to know what would happen if he didn’t develop but wanted to connect his existing house(s) to City domestic and recycled water. If that were the case, he would have to pay the per unit fair share cost to Ambient for whatever Excess Public Improvement he is utilizing, provided the RA has not yet expired. Mr. Mangano wanted assurances that the final reimbursable amount to be paid by his development would be based on the number of actual units being constructed, not on the number of units allowed in the tentative map approvals or in the OASP. Staff confirmed that the reimbursements would be collected on a per unit basis for the actual number of units being constructed. However, the per unit amount may be proportionally increased or decreased dependent upon the final cost of the Excess Public Improvements and revisions to number of units being proposed. Ms. Pratt, the owner of the Pratt(2) parcel, asked for and received additional clarification on how the costs were distributed. Like Mr. Mangano, she also wanted clarification that the amount paid would be based on the number of units actually constructed, not the overall percentage assigned to her property. CONCURRENCES The Public Works Department and Utilities Department concur with the recommended action. ENVIRONMENTAL REVIEW The Orcutt Area Specific Plan (OASP) and an associated Final Environmental Impact Report (FEIR) were approved and certified in March 2010. Implementation of the Public Facil ities Financing Plan (PFFP), including actions such as the appended “Infrastructure Reimbursement Agreement”, were anticipated as part of the approval of the OASP (see OASP Section 8 Public Facilities Financing) to secure needed infrastructure in supporting orderly growth in the OASP Planning Area. Further environmental review was performed with Mitigated Negative Declarations for the Righetti, Jones, Imel, and Taylor/Wingate subdivisions. Additional environmental review will be required for Pratt(1) when a development application is submitted. Approval of this Reimbursement Agreement would not result in any new environmental impacts that were not previously addressed in the certified OASP FEIR and subsequent tiered environmental documents. Therefore, no further environmental review is required for this action. Packet Pg 112 9 FISCAL IMPACT There is no financial impact to the City associated with adopting and implementing the Reimbursement Agreement. All costs to implement and indemnify shall be borne by Ambient. Pursuant to the Municipal Code, reimbursements shall be made only when the city collects money from the developers of new projects and failure or error by the city resulting in funds not being collected will not subject the city to any liability, obligation o r debt owed the original developer. ALTERNATIVES Continue Consideration of the Proposed Reimbursement Agreement Pending Additional Information Required. Council may elect to continue consideration of the Reimbursement Agreement in order to provide additional clarifications or information needed to render a decision. Should Council elect this alternative, direction should be provided to staff as to the additional information needed for Council consideration. Deny Approval of the Reimbursement Agreement. Council may elect not to approve the Reimbursement Agreement if findings are made that the RA is inconsistent with the conditions of approval for the Ambient tract map approvals, and/or the RA is inconsistent with San Luis Obispo’s Municipal Code regarding facilities and improvements benefitting adjacent properties and/or oversizing and excess facilities do not in fact benefit other parties. Therefore, denying approval of the Reimbursement Agreement is not a recommended alternative unless the required findings are made. Attachments: a - Vicinity and Ownership Map b - Resolution Approving Reimbursement Agreement c - Reimbursement Agreement d - Excess Public Improvements plat Packet Pg 113 9 Righetti Ranch Approved 2015 Imel Approved 2017 Jones Approved 2015 West Creek Approved 2016 Taylor- Muick Approved 2013 Packet Pg 114 9 R _____ RESOLUTION NO. (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING A REIMBURSEMENT AGREEMENT WITH AMBIENT COMMUNITIES FOR OFFSITE AND OVERSIZED PUBLIC IMPROVEMENTS ASSOCIATED WITH ORCUTT AREA SPECIFIC PLAN DEVELOPMENT PROJECTS WHEREAS, Ambient Communities, aka Righetti Ranch LP, a Delaware limited partnership, has made application for the approval of an “Infrastructure Reimbursement Agreement” concerning the development of residential projects in the Orcutt Area Specific Plan (OASP) Planning Area; and WHEREAS, Ambient Communities has secured various approvals to construct said residential communities subject to conditions of approval that require the orderly and timely completion of public infrastructure improvements to support growth within the OASP; and WHEREAS, there are certain public improvements associated with the Ambient projects that include public improvements that must be installed on adjacent properties and/or are greater in size and capacity than required to serve only the Ambient projects (“Excess Public Improvements”), thereby qualifying said Excess Public Improvements for reimbursement as set forth in San Luis Obispo Municipal Code Section 16.20.110; and WHEREAS, Ambient Communities has presented estimates of the costs to design, permit and construct said Excess Public Improvements, as well as detailed breakdowns of the adjacent and nearby properties that may benefit from the installation of the Excess Public Improvements; and WHEREAS, the approval of a Reimbursement Agreement will assist in the orderly and timely completion of public infrastructure within the developing Orcutt Area Specific Plan. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. The “Infrastructure Reimbursement Agreement” is hereby approved, and the Mayor is authorized to approve minor revisions and execute said Agreement on behalf of the City. SECTION 2. The Public Works Director is authorized to administer and implement the “Infrastructure Reimbursement Agreement” as provided therein. SECTION 3. The Mayor and City staff are authorized to take action necessary to carry out the intent of this resolution. SECTION 4. Environmental Review. The Orcutt Area Specific Plan (OASP) and an associated Final Environmental Impact Report (FEIR) were approved and certified in March 2010. Implementation of the Public Facilities Financing Plan (PFFP), including actions such as the appended “Infrastructure Reimbursement Agreement”, were anticipated as part of the approval of the OASP (see OASP Section 8 Public Facilities Financing) to secure needed infrastructure in supporting orderly growth in the OASP Planning Area. Further environmental review was Packet Pg 115 9 Resolution No. (2017 Series) Page 2 R _____ performed with Mitigated Negative Declarations for the Righetti, Jones, Imel, and Taylor/Wingate subdivisions. Additional environmental review will be required for Pratt(1) when a development application is submitted. Approval of this Reimbursement Agreement would not result in any new environmental impacts that were not previously addressed in the certified OASP FEIR and subsequent tiered environmental documents. Therefore, no further environmental review is required for this action. Upon motion of _______________________, seconded by ________________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this ______ day of _______________ 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 116 9 1 INFRASTRUCTURE REIMBURSEMENT AGREEMENT (Righetti Ranch and Jones Ranch-Vesting Tentative Maps 3063 and 3066) This Infrastructure Reimbursement Agreement ("Agreement") is entered into this _____ day of ________, 2017 (the "Effective Date"), by and between the City of San Luis Obispo, a municipal corporation and charter city ("CITY") and Righetti Ranch L.P., a Delaware limited partnership ("DEVELOPER"). The CITY and DEVELOPER are sometimes hereinafter referred to individually as a "party" and collectively as "parties." RECITALS WHEREAS, DEVELOPER is currently developing a residential project in the City of San Luis Obispo, California, pursuant to approved Vesting Tentative Tract Map 3063 for property known as the "Righetti Ranch", and approved Vesting Tentative Map 3066, for property known as the "Jones Ranch." The development of both the Righetti Ranch and Jones Ranch are jointly referred to hereinafter as the "Project"; and WHEREAS, the Project is subject to various City requirements and conditions of approval, including but not limited to, those of the Vesting Tentative Maps, the Orcutt Area Specific Plan ("Specific Plan") and the Specific Plan's Final Environmental Impact Report ("FEIR"); and WHEREAS, some of the conditions of approval of the Project require DEVELOPER to install certain street, water, wastewater and other public infrastructure improvements ("Public Improvements"); and WHEREAS, in order to develop the Project, and to connect to existing CITY infrastructure, some of the Public Improvements are required to be installed adjacent to property other than that being developed by DEVELOPER or in greater size or capacity than that required for the development of the Project ("Excess Public Improvements"), and may be eligible for reimbursement under San Luis Obispo Municipal Code ("SLOMC") Section 16.20.110; and WHEREAS, CITY and DEVELOPER wish to identify the Excess Public Improvements that may be eligible for reimbursement and their estimated costs ("Reimbursable Costs"); identify the properties that are not within the Project site development area that benefit from the Excess Public Improvements (individually a "Benefitted Property" and collectively "Benefitted Properties") and each property's prorated share of the Public Improvement costs, and define the respective rights and obligations of the parties under this Agreement; and WHEREAS, DEVELOPER is paying for the construction and/or installation of the Public Improvements, with the development of the Project. DEVELOPER is eligible to be reimbursed for the Reimbursable Costs, to the extent and on the terms and conditions set forth in this Agreement. Packet Pg 117 9 2 AGREEMENT Subject to the terms and conditions set forth below, the parties agree as follows: 1. Recitals. The above recitals are true and correct. The recitals set forth above, and all defined terms set forth in such recitals and in the preamble preceding the recitals, are hereby incorporated into this Agreement as though set forth in full. 2. Term. This Agreement shall expire fifteen (15) years from date of execution. After such expiration, all of the rights of DEVELOPER shall be null and void and DEVELOPER shall have no further right to reimbursement for any Reimbursable Costs or interest. 3. Construction of Public Improvements. DEVELOPER shall construct the Public Improvements to CITY's satisfaction pursuant to all CITY standard specifications and rules and regulations and per the approved plans, and any approved alterations thereto, on file at the CITY. CITY shall issue to DEVELOPER an encroachment permit for any Public Improvements occurring within the CITY's right of way subject to reasonable terms and conditions. Through the execution of this Agreement, the Parties have identified the Public Improvements and the estimated costs that are subject to reimbursement, the designated Benefitted Properties (as defined below) and each Benefitted Properties' prorated share of the documented Reimbursable Costs, as specified in Exhibit "A," discussed below in Section 4 of this Agreement. 4. Reimbursable Costs. The Excess Public Improvements and each of the Benefitted Properties’ prorated share of related Reimbursable Costs are shown on Exhibit "A," attached and incorporated by this reference. The prorated shares and Reimbursable Costs are estimates prepared by DEVELOPER's engineer. The actual amount that DEVELOPER shall be reimbursed for will be determined in accordance with Section 8 and this Section. Reimbursable Costs also shall include (i) DEVELOPER's reasonable out-of-pocket costs incurred in acquiring off-site interests of property needed to construct the Excess Public Improvements, including the fair market value of the acquired property and associated reasonable closing costs, but shall not include any charges for time incurred by anyone on DEVELOPER's behalf. These costs are subject to approval by the City prior to final acquisition expense; and (ii) Costs DEVELOPER is required to pay and pays CITY for processing and approving all plans, designs and specifications of the Excess Public Improvements, including all permitting costs; and (iii) CITY's costs specified in Section 9 of this Agreement. Each of the Benefitted Properties' prorated share of the Reimbursable Costs is subject to further review and approval by the CITY's Director of Public Works ("Director") at any time prior to collection. If the Director issues a determination or approval which deviates from Exhibit "A", the Director shall attempt to meet and confer with DEVELOPER in an attempt for the Parties to mutually agree to such deviations from Exhibit "A." If the Parties cannot agree to such deviations within thirty (30) days of the Director's invitation to meet and confer, the Director shall have ultimate authority to determine any deviation from Exhibit "A." Packet Pg 118 9 3 5. Benefitted Properties. CITY and DEVELOPER agree that the Excess Public Improvements significantly benefit the Benefitted Properties. The Benefitted Properties are deemed to be any and all parcels of land that lie within the Reimbursement Area shown on Exhibit "B." 6. Reimbursement/Withholding in Event of Protest/Offset. a. Subject to the terms and conditions hereof, CITY will in good faith attempt to collect from the Benefitted Properties a prorated share of the documented Reimbursable Costs, as shown on Exhibit "A", or as otherwise determined by the Director in accordance with Section 4. CITY shall not be required to reimburse more money than it actually collects. Failure or error by CITY to collect funds or Reimbursable Costs will not subject CITY to any liability, obligation, or debt to DEVELOPER, its successors or assigns. Notwithstanding the foregoing, subject to the provisions of Section 6(b) and (c) of this Agreement, CITY shall reimburse DEVELOPER pursuant to the terms of this Agreement for all funds or Reimbursable Costs actually collected by the CITY. If CITY does not reimburse DEVELOPER after CITY collects such payments from the owners or developers of Benefitted Properties, DEVELOPER shall be entitled to exercise all legal remedies. b. If any owner or developer of one or more of the Benefitted Properties pays all or a portion of the Reimbursement Costs under protest, CITY shall not be required to make reimbursements under this Agreement until the limitation period for instituting court action to seek a refund of such funds paid under protest has passed, and no court action ("Action") has been instituted. If an Action is instituted seeking refund of funds paid under protest, or to prevent CITY from collecting such funds, or challenging any provision of this Agreement, CITY shall not pay over such funds to DEVELOPER until the Action has been finalized and the authority of CITY to collect such funds and reimburse DEVELOPER has been sustained. CITY shall promptly notify DEVELOPER in writing of the Action. CITY shall reasonably support DEVELOPER's efforts to participate as a party to the Action, to defend the Action or settle the Action. Furthermore, CITY shall have the right to turn over the defense of the Action to DEVELOPER. If, within fifteen (15) days of CITY mailing a notice in compliance with Section 18 below requesting that DEVELOPER defend the Action, DEVELOPER fails to undertake the defense of the Action at DEVELOPER's sole cost and expense, CITY may stipulate to return of the funds so paid under protest, to cease collecting such funds, or enter into any other settlement of the Action acceptable to CITY and DEVELOPER shall lose any right to reimbursement under this Agreement of the amount contested in the Action. DEVELOPER shall reimburse CITY for its costs and attorneys' fees incurred in defense of the Action, including reasonable payment for legal services performed by the CITY's City Attorney, and for any liability CITY incurred in the Action, and such costs, fees and liability shall not be Reimbursable Costs. In addition, if CITY fails to impose a requirement upon development projects proposed by owners or developers of the Benefitted Properties, to pay their respective prorated share of the Reimbursable Costs, as specified in Exhibit "A" or as determined by the Director under Section 4 of this Agreement, or fails to collect such funds, DEVELOPER Packet Pg 119 9 4 may exercise all of its legal rights to attempt to collect such funds from the Benefitted Properties, which legal rights shall not be interpreted to include an action against the CITY. In the event DEVELOPER attempts to collect such funds from the Benefitted Properties, CITY shall assign to DEVELOPER all of its rights to collect such funds under this Agreement. c. Offset. CITY reserves the right to offset any Reimbursable Costs it collects against any unpaid fees, debts or obligations of DEVELOPER to CITY. CITY shall provide DEVELOPER with notice, in accordance with Section 18, of CITY's intent to offset any collected Reimbursable Costs against unpaid fees, debts or obligations described in the notice, and provide DEVELOPER with a reasonable opportunity to cure. 7. Bids for Installation of Public Improvements. In order to assure the Benefitted Properties that the costs of construction of the Excess Public Improvements are reasonable, prior to commencing construction of the Public Improvements, DEVELOPER shall obtain at least three (3) non-collusive bids for construction of the Public Improvements, and provide copies to CITY. DEVELOPER is not required to accept any particular bid. However, when DEVELOPER provides CITY with evidence of actual costs under Section 8, DEVELOPER must justify to CITY's reasonable satisfaction the selection of one of the higher bids if the difference between the bids is substantial and/or above the engineer's estimate set forth in Exhibit "A." As part of the bid packages both contractor and DEVELOPER shall provide Non-Collusion Affidavits in a form approved by the City Attorney. 8. Proof and Due Date of Reimbursable Costs. a. DEVELOPER shall provide CITY with evidence of the actual costs of each of the Public Improvements in the form of receipted bills, canceled checks, and contracts. All invoices or other documentation requested by CITY to confirm DEVELOPER's actual costs of the Public Improvements shall be submitted to CITY within sixty (60) days of the CITY's acceptance of the respective Public Improvement. Approval of Reimbursement Costs may occur in phases as projects are accepted by CITY. Failure to timely submit evidence shall void this Agreement with respect to that portion of the Public Improvements for which documentation is not timely filed. b. Failure to submit evidence sufficient to enable CITY to determine that costs were properly allocated to a specific Public Improvement shall void DEVELOPER's right to reimbursement for that Public Improvement. DEVELOPER shall be deemed to have failed to submit sufficient evidence if, as soon as reasonably possible after DEVELOPER's original timely submission of evidence, CITY notifies DEVELOPER, in writing, that the documentation submitted is inadequate, and after CITY provides such written notice, DEVELOPER thereafter fails to respond to such notice within sixty (60) days. If DEVELOPER complies with the deadlines specified in this Section 8(b), such a process shall be repeated until CITY determines it has adequate documentation to reimburse DEVELOPER or DEVELOPER has no new documentation to provide to CITY. Packet Pg 120 9 5 c. Regardless of DEVELOPER's claimed costs incurred in constructing the Excess Public Improvements, CITY has the authority, through its Director or designee, in the exercise of his or her reasonable discretion, to determine the amount subject to possible reimbursement for each Excess Public Improvement. The purpose of this provision is to prevent unrelated, unjustified, unreasonable or excess costs from being passed on to the Benefitted Properties, and to ensure that DEVELOPER exercises reasonable control over costs of construction. If the Director disapproves any of DEVELOPER's claimed costs, the Director shall attempt to meet and confer with DEVELOPER to resolve the dispute. If the Parties cannot resolve the dispute within thirty (30) days of the Director's invitation to meet and confer, the Director shall have ultimate authority to determine the amount subject to possible reimbursement. 9. Payment of City Costs to Determine Reimbursable Amount. DEVELOPER shall reimburse CITY for CITY's actual costs incurred in determining the amount subject to possible reimbursement, including time and materials. Time/labor costs shall include benefits. 10. Reduction of Reimbursable Costs by Other Reimbursements. DEVELOPER may enter into agreements with other property owners or developers of the Benefitted Properties or others, addressing DEVELOPER's right to reimbursement resulting from DEVELOPER's oversizing or construction of Public Improvements that will benefit development of those other properties. To the extent DEVELOPER enters into such agreements or receives payment or consideration from others for costs that are otherwise "Reimbursable Costs" under this Agreement, such payments or consideration will be credited against the Reimbursable Costs otherwise due DEVELOPER under this Agreement. Notwithstanding the foregoing, DEVELOPER has no obligation to attempt to pursue reimbursement from other property owners or developers of the Benefitted Properties. 11. Timing of Reimbursement/Payment/Interest. Contingent upon completion and CITY's acceptance of the Public Improvements, and DEVELOPER's timely submission and CITY's approval of all invoices or other documentation as set forth in Section 8 above, and subject to Section 6, CITY shall attempt to collect from each of the Benefitted Properties, prior to the earlier of Final Map recordation or building permit issuance, its respective prorated share of the Reimbursement Costs, plus interest at two percent (2%) per year from the date the CITY accepts the Public Improvement subject to reimbursement under this Agreement. Any amount of Reimbursement Costs CITY collects shall be sent to DEVELOPER within thirty (30) days of receipt, subject to the provisions of Section 6. a. All reimbursements shall be by check or warrant made payable to: Righetti Ranch L.P. and mailed to: 179 Calle Magdalena, #201, Encinitas, CA 92024. 12. Indemnification. DEVELOPER agrees to indemnify, defend and hold CITY, its officials, agents, employees and contractors, harmless from any expense, liability or claim for death, injury, loss, damage or expense to persons or property which may arise or is any way related to: DEVELOPER's design or construction of the Public Improvements; or DEVELOPER's performance under this Agreement, or that of its contractors or agents; or Packet Pg 121 9 6 from DEVELOPER's failure to pay prevailing wages for the construction of the Public Improvements or comply with applicable provisions of the Labor Code; or any litigation or Action under Section 6 or Section 7. Notwithstanding the foregoing, DEVELOPER shall have no duty to indemnify CITY for any expense, liability or claim for death, injury, loss, damage or expense to persons or property which may arise from the sole negligence or willful misconduct of CITY, officials, agents, employees and contractors. DEVELOPER's indemnity obligations of this Section 12 shall expire at different times and may extend beyond expiration or termination of this Agreement. With regard to the construction of a specific Public Improvement, the indemnity obligation shall expire one (1) year after CITY's acceptance of that Public Improvement; provided, if CITY requests DEVELOPER to repair or replace any portion of a Public Improvement within one year of acceptance, DEVELOPER's indemnity obligation relating to the repaired or replaced portion of the Public Improvement shall extend for one (1) year commencing from date of the City’s acceptance of the repair or replacement. The Parties anticipate that DEVELOPER may construct, and CITY may accept, the Public Improvements, in multiple phases, at different times and that the indemnity obligations under this section may be staggered. With regard to any lawsuit or claim filed under Sections 6, 7 or 13, the indemnity obligation with regard to any such lawsuit(s) or claim(s)shall extend until final resolution of the lawsuit(s)or claim(s) and satisfaction of City’s related liability, loss and expense. 13. Labor laws and Prevailing Wages. DEVELOPER shall comply with and adhere to all applicable labor laws, which may include payment of prevailing wages, nondiscrimination, payroll records, apprentices, etc. It shall be DEVELOPER's responsibility to determine the applicability of prevailing wage and other Labor Code provisions to DEVELOPER's construction of the Public Improvements. DEVELOPER assumes all financial responsibility for adverse prevailing wage actions or determinations. 14. Entire Agreement/Amendment. This Agreement represents the entire integrated agreement between the CITY and DEVELOPER regarding reimbursement for the Excess Public Improvements, and supersedes all prior negotiations, representations or agreements, either written or oral. This Agreement may be amended only by a written instrument signed by both CITY and DEVELOPER. 15. Governing Law and Venue. The interpretation and implementation of this Agreement shall be governed by the law of California, except for those provisions preempted by federal law. However, the laws of the State of California shall not be applied to the extent that they would require or allow the court to use the laws of another state or jurisdiction. The parties agree that all actions or proceeding arising out of or relating to the Agreement shall be tried and litigated only in the County of San Luis Obispo or the United States District Court for the Central District of California. 16. Severability. Invalidation of any provision contained herein or the application thereof to any person or entity by judgment or court order shall in no way affect any of the other covenants, conditions, restrictions, or provisions hereof, or the application thereof to any other person or entity, and the same shall remain in full force and effect. Packet Pg 122 9 7 17. Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. 18. Notices. All notices, demands, invoices, or written communications to the parties required or permitted hereunder shall be in writing and delivered personally or by U.S. mail, postage prepaid, to the following addresses or such other address as the parties may designate in accordance with this section: CITY Director Public Works 919 Palm Street San Luis Obispo, CA 93401 With a copy to: City Attorney 990 Palm Street San Luis Obispo, CA 93401 DEVELOPER Righetti Ranch, L.P. 979 Osos Street, Suite E San Luis Obispo, CA 93401 Attn: Travis Fuentez Phone: (805) 573-0401 Ambient Communities 179 Calle Magdalena, Suite 201 Encinitas, CA 92024 Attn: Rob Anselmo Phone: (619) 890-2349 With a copy to: Allen Matkins 1900 Main Street, 5th Floor Irvine, CA 92614 Attn: John Condas Phone: (949) 851-5551 19. Interpretation/Ambiguity. This Agreement was negotiated by the Parties, with the advice and assistance of their respective counsel, and shall not be construed in favor of or against either Party, regardless of who may have drafted it or any of its terms. Any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in interpreting this Agreement. 20. Assignment. DEVELOPER shall not assign, transfer or convey any of its rights, duties or obligations under this Agreement without the prior written approval of CITY. CITY shall not unreasonably withhold approval of any assignment. Any other assignment shall be null and void. Packet Pg 123 9 8 21. Authority to Execute. Both CITY and DEVELOPER do covenant that each individual executing this agreement on behalf of each party is a person duly authorized and empowered to execute Agreements for such party. [Signatures on following page] Packet Pg 124 9 9 IN WITNESS WHEREOF, the parties have executed this Agreement as of the first date written above. ATTEST: ______________________________ Carrie Gallagher, City Clerk APPROVED AS TO FORM: ________________________________ J. Christine Dietrick, City Attorney CITY OF SAN LUIS OBISPO, a municipal corporation and charter city _____________________________ Heidi Harmon, Mayor DEVELOPER Righetti Ranch, LP A Delaware Limited partnership By: NRE Manager, LLC, a Delaware limited liability company Its: General Partner By: Ambient Righetti Manager, LLC, A California limited liability company Its: Sole member By: ____________________________ Travis Fuentez, President By: ____________________________ Dante Anselmo, Vice-President APPROVED AS TO FORM FOR DEVELOPER ____________________________ Packet Pg 125 9 RighettiRanchReimbursementAgreementExhibitA6Ͳ7Ͳ2017ImprovementsEligibleforReimbursement1a)OffsitewaterlinefronCedartoOrcuttRoad.Includespressurereducingvaultandrequiredtelemtryperapprovedplans.Reconnectexistingservicesalongrouteandabandonexistingwatermain.707,198.02$AmbientTaylor/MuickFarrior/Hall/Fiala/WestCreek/Garay792 Population 1747404,771$57.2%18,061$2.6% 144,527$20.4%44,819$6.3%95,019$13.4%1b)OffsitewaterlinefromJohnsonRoadtoTiburon.Includessawcutexistingroadtoinstallnewwaterlineperapprovedplans.340,202.19$AmbientTaylor/MuickFarrior/Hall/Fiala,Garay575 Population 1390244,733$71.9%10,920$3.2%27,099$8.0%57,451$16.9%2)WaterMaininRanchHouseRoadtoSponza70,740.35$Jones/Pratt(1)Taylor/MuickPratt(2)/Evans/Anderson470 Population 902 18,051$25.5% 34,289$48.5% 18,400$26.0%3)RecycledWaterMainalongRighettiRanchRoadfromTankFarmtoTiburon/AlongTiburonfromRighettiRanchRoadtoRanchHouseRoad/AlongRanchHouseRoadtoSponza(Note:InteriorRWlinecostwithinParktobepaidthroughPFFP)475,934.29$3063Phase1&2,Jones/Imel/Pratt(1&2)/Taylor/Muick/Farrior/Hall/FialaWestCreek/Evans/Anderson682RecycledWaterdeliverydemandingpm163204,652$43.0%23,797$5.0%80,909$17.0% 114,224$24.0%52,353$11.0%4)SanitarySewerMainlineinRanchHouseRoadfromTiburontoSponza.58,368.46$Taylor/Muick110 Population 23558,368$100%5)IntentionallyLeftBlank6a)Phase1ͲOrcuttRoadEastsideStreetimprovementsfromFialaPropertytoGarayPropertytaper.ToincludelefthandturnlaneatTiburon,culvertextensions,utilityrelocations,stormdraintreatmentfacilitiesandotherimprovementspertheapprovedplans574,457.25$3063Phase2Pratt(1)/Jones/ImelTaylor/Muick367AverageDailyTrips2799 401,294$69.9%173,163$30.1%6b)Phase3ͲOrcuttRoadEastsideStreetimprovementsfromGarayPropertytapertoHansenLane.Toincludecenterturnlane,culvertextensions,utilityrelocations,stormdraintreatmentfacilitiesandotherimprovementspertheapprovedplans770,592.44$3063Phase3/Garay79AverageDailyTrips718331,647$43.0%438,945$57.0%7)OrcuttRoadWestsideStreetImprovementalongGarayFrontage.Improvementstoincludeculvertextensions,utilityrelocation,stormdraintreatmentfacilitiesandotherimprovementspertheapprovedplansforthissectionofwork.365,245.63$Garay45Frontage 100%Frontage365,246$100%TotalReimbursements3,362,739$Ͳ $1,605,148$52,778$Ͳ$225,436$Ͳ$148,514$876,109$454,754$AllocationofCostPerResidentialUnitTypeByBenefitingPropertyUnitCountSFRMFRTotalPopulation*ADT**SFRShare(303dus)SFRShare(4dus)SFRShare(67dus) SFRShare(0dus) SFRShare(45dus) SFRShare(53dus)Tract3063(Righetti)Phase1(Ambient) 15115137113731,205,176.06$11,540.86$104,079.44$Ͳ$876,108.70$284,972.62$Tract3063(Righetti)Phase2(Ambient) 8732119273994Tract3063(Righetti)Phase3(Ambient) 343484309 CostPerSFRCostPerSFRCostPerSFRCostPerSFRCostPerSFRCostPerSFRTract3066(Jones)Phase1(Ambient) 1452661304573,977.48$2,885.21$1,553.42$Ͳ$19,469.08$5,376.84$Tract3095(Imel)(Ambient) 171742155Pratt1(APN053Ͳ061Ͳ024)(Ambient)5555101349Pratt2(APN076Ͳ481Ͳ007),Evans,Anderson2392394371518 MFRShare(139dus)MFRShare(19dus) MFRShare(105dus) MFRShare(239dus) MFRShare(0dus) MFRShare(57dus)Tract3083WestCreek 671051723571276399,738.09$40,780.04$121,337.60$148,513.67$Ͳ$169,846.26$Farrior,Hall191935121Taylor/Muick(ManganoProposedProject6Ͳ2Ͳ2017) 5357110235844 CostPerMFRCostPerMFRCostPerMFRCostPerMFRCostPerMFRCostPerMFRGaray 45451114092,875.81$2,146.32$1,155.60$621.40$Ͳ$2,979.76$Fiala 441036472559103121847840TotalShareTotalShareTotalShareTotalShareTotalShareTotalShare1,604,914$52,321$225,417$148,514$876,109$454,819$TableNotes(Source:OrcuttAreaSpecificPlanPublicFacilitiesFinancingPlan,2016):TotalSharebyAmbientFarrior/Hall,FialaWestCreekPratt2,Evans,GarayTaylorͲMuick*Population=2.46residents/SFR=1.83residents/MFRGPM=gallonsperminuteAnderson**ADTͲAverageDailyTrips(vehicles)=9.09/SFR=6.35/MFRSFR=singlefamilyresidential;MFR=multiͲfamilyresidentialdus=dwellingunitssomevariationincalculationsduetoroundingTotalBenefitUnitsbyTypeMangano(Taylor/Muick)Ambient(RighettiͲTM#3063/JonesͲTM#3066/ImelͲTM#3095)/Pratt(1)Population=1000ADT=3637GPM=70Pop.=45ADT=157GPMͲ8%Share%SharePop.=111ADT=409GPM=0BenefitingParcelsTotalApprovedorOASPAssignedUnitCountsEstimatedCost(fromattacheddetailedbreakdowns)BenefitingPropertieswithintheOASP(PropertySharebasedonPopulation,RecycledWaterFlowProjectionsorADTPercentage)Pratt(2),Evans,AndersonPop.=437ADT=1518GPM=39%ShareWestCreekPop.=357ADT=1276GPM=28%SharePop.=235ADT=844GPM=18%Share%ShareFarrior/Hall,FialaGarayMethodofAssigningBenefitbyTypeExhibit A Packet Pg 1269 Reimbursable Improvement 1a - Waterline Cedar Court to Orcutt Rd Offsite Waterline Construction Fee Estimate Item Description Quantity Unit Unit Cost Total Water System Mobilization 1 LS 12,500.00 12,500 Traffic Control 1 LS 30,000.00 30,000 1 6" PVC Water Line 62 LF 50.00 3,100 2 8" PVC Water Line LF 104.00 - 3 12" PVC Water Line 800 LF 165.00 132,000 4 8" Ductile Iron Pipe LF 114.00 - 5 12" Ductile Iron Pipe 8 LF 165.00 1,320 6 2" Blowoff Assembly 1 EA 3,200.00 3,200 7 2" Air Relief Valve EA 3,975.00 - 8 Connect to Existing Laterals 6 EA 2,000.00 12,000 9 Gate Valve (6")6 EA 1,300.00 7,800 10 Gate Valve (8")3 EA 1,500.00 4,500 11 Gate Valve (12")13 EA 3,500.00 45,500 12 Thrust Block (6")2 EA 250.00 500 13 Thrust Block (8")3 EA 385.00 1,155 14 Thrust Block (12")9 EA 714.00 6,426 15 4" Warf Head 1 EA 1,000.00 1,000 16 Fire Hydrant 2 EA 8,510.00 17,020 17 Connect to Existing System 3 LS 5,000.00 15,000 18 Waterline Under Crossing 1 LS 5,000.00 5,000 19 CLA VAL 2 EA 3,000.00 6,000 20 Victaulic Couplings 4 EA 300.00 1,200 21 12"x8" Reducer 2 EA 2,000.00 4,000 22 Pipe Support 4 EA 500.00 2,000 23 PRV and Concrete Vault 1 EA 50,000.00 50,000 24 Saw Cut Asphalt Concrete 1,724 LF 2.17 3,741 25 Trench Patch 2,586 SF 4.00 10,344 26 Restore Traffic Striping 1 LS 10,000.00 10,000 PRV Telemetry 1 Telemetry 1 LS 110,000.00 110,000 Sub Total 495,306 Design & Consultants 15.0%74,296 Plan Check 1.9%9,411 Inspection 12.9%63,894 Sub Total 642,907 Contingency 10.0%64,291 Total 707,198 Exhibit A Packet Pg 127 9 Reimbursable Improvement 1b - Waterline Johnson Rd to Tiburon Rd Offsite Waterline Construction Fee Estimate Item Description Quantity Unit Unit Cost Total Water System Mobilization 1 LS 12,500.00 12,500 Traffic Control 1 LS 30,000.00 30,000 1 6" PVC Water Line LF 50.00 - 2 8" PVC Water Line 1,280 LF 104.00 133,120 3 12" PVC Water Line LF 165.00 - 4 8" Ductile Iron Pipe LF 114.00 - 5 12" Ductile Iron Pipe LF 165.00 - 6 2" Blowoff Assembly 1 EA 3,200.00 3,200 7 2" Air Relief Valve 1 EA 3,975.00 3,975 8 Connect to Existing Laterals EA 2,000.00 - 9 Gate Valve (6")EA 1,300.00 - 10 Gate Valve (8")4 EA 1,500.00 6,000 11 Gate Valve (12")EA 3,500.00 - 12 Thrust Block (6")EA 250.00 - 13 Thrust Block (8")4 EA 385.00 1,540 14 Thrust Block (12")EA 714.00 - 15 4" Warf Head EA 1,000.00 - 16 Fire Hydrant 2 EA 8,510.00 17,020 17 Connect to Existing System LS 5,000.00 - 18 Waterline Under Crossing LS 5,000.00 - 19 CLA VAL EA 3,000.00 - 20 Victaulic Couplings EA 300.00 - 21 12"x8" Reducer EA 2,000.00 - 22 Pipe Support EA 500.00 - 23 Concrete Vault EA 9,000.00 - 24 Saw Cut Asphalt Concrete 2,560 LF 2.17 5,555 25 Trench Patch 3,840 SF 4.00 15,360 26 Restore Traffic Striping 1 LS 10,000.00 10,000 PRV Telemetry 1 Telemetry 1 LS - Sub Total 238,270 Design & Consultants 15.0%35,741 Plan Check 1.9%4,527 Inspection 12.9%30,737 Sub Total 309,275 Contingency 10.0%30,927 Total 340,202 Exhibit A Packet Pg 128 9 Reimbursable Improvement 2 - Water Main Ranch House Rd to Sponza Rd Waterline Construction Fee Estimate Item Description Quantity Unit Unit Cost Total Water System Mobilization 0.50 LS 12,500.00 6,250 Traffic Control 0.00 LS 30,000.00 - 1 6" PVC Water Line 0.00 LF 50.00 - 2 8" PVC Water Line 465.00 LF 45.00 20,925 3 12" PVC Water Line 0.00 LF 165.00 - 4 8" Ductile Iron Pipe 0.00 LF 114.00 - 5 12" Ductile Iron Pipe 0.00 LF 165.00 - 6 2" Blowoff Assembly 1.00 EA 3,200.00 3,200 7 2" Air Relief Valve 1.00 EA 3,975.00 3,975 8 Connect to Existing Laterals 0.00 EA 2,000.00 - 9 Gate Valve (6")0.00 EA 1,300.00 - 10 Gate Valve (8")5.00 EA 1,500.00 7,500 11 Gate Valve (12")0.00 EA 3,500.00 - 12 Thrust Block (6")0.00 EA 250.00 - 13 Thrust Block (8")7.00 EA 385.00 2,695 14 Thrust Block (12")0.00 EA 714.00 - 15 4" Warf Head 0.00 EA 1,000.00 - 16 Fire Hydrant 0.00 EA 8,510.00 - 17 Connect to Existing System 1.00 LS 5,000.00 5,000 18 Waterline Under Crossing 0.00 LS 5,000.00 - 19 CLA VAL 0.00 EA 3,000.00 - 20 Victaulic Couplings 0.00 EA 300.00 - 21 12"x8" Reducer 0.00 EA 2,000.00 - 22 Pipe Support 0.00 EA 500.00 - 23 Concrete Vault 0.00 EA 50,000.00 - 24 Saw Cut Asphalt Concrete 0.00 LF 2.17 - 25 Trench Patch 0.00 SF 4.00 - 26 Restore Traffic Striping 0.00 LS 10,000.00 - PRV Telemetry 1 Telemetry 0.00 LS 61,000.00 - Sub Total 49,545 Design & Consultants 15.0%7,432 Plan Check 1.9%941 Inspection 12.9%6,391 Sub Total 64,309 Contingency 10.0%6,431 Total 70,740 Exhibit A Packet Pg 129 9 Reimbursable Improvement 3 - Recycled Water Main Tank Farm to Sponza to Ranch House Rd Reclaimed Waterline Construction Fee Estimate Item Description Quantity Unit Unit Cost Total Water System Mobilization 0.50 LS 12,500.00 6,250 Traffic Control 0.20 LS 30,000.00 6,000 1 6" PVC Water Line 0.00 LF 50.00 - 2 8" PVC Water Line 0.00 LF 104.00 - 3 12" PVC Water Line 0.00 LF 165.00 - 4 8" Ductile Iron Pipe 2,471.00 LF 114.00 281,694 5 12" Ductile Iron Pipe 0.00 LF 165.00 - 6 2" Blowoff Assembly 2.00 EA 3,200.00 6,400 7 2" Air Relief Valve 2.00 EA 3,975.00 7,950 8 Connect to Laterals 4.00 EA 2,000.00 8,000 9 Gate Valve (6")0.00 EA 1,300.00 - 10 Gate Valve (8")5.00 EA 1,500.00 7,500 11 Gate Valve (12")0.00 EA 3,500.00 - 12 Thrust Block (6")0.00 EA 250.00 - 13 Thrust Block (8")4.00 EA 385.00 1,540 14 Thrust Block (12")0.00 EA 714.00 - 15 4" Warf Head 1.00 EA 1,000.00 1,000 16 Fire Hydrant 0.00 EA 8,510.00 - 17 Connect to Existing System 1.00 LS 5,000.00 5,000 18 Waterline Under Crossing 0.00 LS 5,000.00 - 19 CLA VAL 0.00 EA 3,000.00 - 20 Victaulic Couplings 0.00 EA 300.00 - 21 12"x8" Reducer 0.00 EA 2,000.00 - 22 Pipe Support 4.00 EA 500.00 2,000 23 Concrete Vault 0.00 EA 50,000.00 - 24 Saw Cut Asphalt Concrete 0.00 LF 2.17 - 25 Trench Patch 0.00 SF 4.00 - 26 Restore Traffic Striping 0.00 LS 10,000.00 - PRV Telemetry 1 Telemetry 0.00 LS 61,000.00 - Sub Total 333,334 Design & Consultants 15.0%50,000 Plan Check 1.9%6,333 Inspection 12.9%43,000 Sub Total 432,668 Contingency 10.0%43,267 Total 475,934 Notes: Interior RW lines within Park ($49,367) Funded Through PFFP Method of assigning benefit is based on Utilities Department estimates of total recycled water demands for each property, translated into a gallons-per-minute delivery demand. OASP parklands costs are prorated by demand estimates below to each property. The total demand by property is then pro-rated to reflect respective shares of total cost. Ambient = 35 gpm demand estimate 43% of total demands $204,651.62 Farrior/Hall, Fiala = 4 gpm 5%$23,796.70 West Creek = 14 gpm 17%$80,908.78 Pratt 2, Evans, Anderson = 20 gpm 24%$114,224.16 Taylor-Muick = 9 gpm 11%$52,352.74 Exhibit A Packet Pg 130 9 Reimbursable Improvement 4 - Sanitary Sewer in Ranch House Rd from Tiburon to Sponza Sanitary Sewer Item Description Quantity Unit Unit Cost Total Sewer System Mobilization 0.20 LS 25,000.00 5,000 Traffic Control 0.00 LS 60,000.00 - 1 8" HDPE 490.00 LF 32.00 15,680 2 10" HDPE 0.00 LF 35.00 - 3 12" HDPE 0.00 LF 52.00 - 4 Manhole 2.00 EA 3,600.00 7,200 5 Mahole Deep 2.00 EA 4,500.00 9,000 6 Manhole Rock 0.00 EA 5,000.00 - 17 Connect to Existing System 1.00 LS 2,000.00 2,000 24 Saw Cut Asphalt Concrete 0.00 LF 2.17 - 25 Trench Patch 0.00 SF 4.00 - 26 Install future stub 2.00 EA 1,000.00 2,000 27 Restore Traffic Striping 0.00 LS 6,000.00 - Sub Total 40,880 Design & Consultants 15.0%6,132 Plan Check 1.9%777 Inspection 12.9%5,274 Sub Total 53,062 Contingency 10.0%5,306 Total 58,368 Exhibit A Packet Pg 131 9 Reimbursable Improvement 6a - Phase 1 Orcutt Road East Side Improvements from Fiala to GarayOrcutt East Side Road Improvement STA 13+25 TO 23+85Item Description Quantity Unit Unit Cost Total DiscussionUnit Cost. Additional To Work Entirely on the West SideTotal D1 Mobilization1.00 LS 18,000.00 18,000 This is an additional charge over the West side construction because the East side work will be done at a different time than the West side development18,000.0018,0002Traffic Control1.00 LS 30,000.00 30,000 Same as above30,000.0030,0003 East Side Road (per Xsec East)1,067.00 LF 171.36182,841 Road Cross Section:Cut Slope with Revegetation: The East side of Orcutt is cut into the slope and requires more recontouring work than the West sidea/c Dyke: The a/c dyke is an additional cost due to road improvement on the east sidePavement With Subbase: Pavement with sub-base is a cost that would occur if all work were on the west side (less 81.25/ft)Saw Cutting: The additional saw cut is entirely due to the work being done on the East sideStreet Grinding: The street grinding is entirely due to work being done on the East sideStriping: The striping is a cost that would occur if the work was done entirely on the West side (less 10.00/ft)80.1185,4774Intersection Blend Tiburon 1,449.00 SF 11.00 15,939 The intersection blend is entirely due to East side construction11.0015,9395Driveway Blend618.00 SF 11.00 6,798 The driveway blend is entirely due to East side construction11.006,7986a/c Dyke @ Int & Drv Blend61.00 LF 10.00 610 The driveway blend is entirely due to East side construction10.006107Vehicle Guardrail271.00 LF 75.00 20,325 The guardrail is entirely due to East side construction75.00 20,3258Lid Structure Mobilization1.00 EA 5,000.00 5,000 East side LID is entirely due to East side construction5,000.005,0009LID Structure Area1,505.00 SF 11.26 16,946 East side LID is entirely due to East side construction11.2616,94610LID Structure Perimeter477.00 LF 45.00 21,465 East side LID is entirely due to East side construction45.0021,46511LID Structure Excavation2.00 EA 1,000.00 2,000 East side LID is entirely due to East side construction1,000.002,00012LID Structure Under Drain Connection2.00 EA 1,000.00 2,000 East side LID is entirely due to East side construction1,000.002,00013LID Structure Landscaping1,505.00 SF 4.00 6,020 East side LID is entirely due to East side construction4.006,02014Culvert Const. Mobilization1.00 EA 15,000.00 15,000 Equipment mobilization on the East side is because the East side will be done at a different time than the West side15,000.0015,00015Culvert Excavation260.44 YD 50.00 13,022 This is entirely East side work50.0013,0224Culvert Headwall Footings572.00 SF 25.00 14,300 This is entirely East side work25.0014,30017 Culvert Pipe Extension1.00 EA 6,000.006,000 If the work were to be done entirely on the West side the pipe extension on the West side would be longer and more expensive. Therefore there is little change in cost in with East side construction - 018Culvert Headwall Area645.00 SF 100.00 64,500 This is entirely East side work100.0064,50019Culvert RSP17.96 YD 150.00 2,694 This is entirely East side work150.002,69420Culvert Excavation Area Clean-Up/Re-Vegetation1,948.00 SF 5.00 9,740 This is entirely East side work5.009,74021Retaining Wall Footings36.00 LF 25.00 900 This is entirely East side work25.0090022Retaining Wall Area180.00 SF 75.00 13,500 This is entirely East side work75.0013,50023Power Pole Bracing5.00 EA 5,000.00 25,000 This is entirely East side work5,000.0025,00024Mail Box Replacement4.00 EA 300.00 1,200 This is entirely East side work300.001,20025Fence Replacement238.00 LF 50.00 11,900 This is entirely East side work50.00 11,900Sub Total 505,701 Sub Total 402,337 Design & Consultants15.0%75,855 60,351 Plan Check1.9%9,608 7,644 Inspection12.9%65,235 51,902 Sub Total 656,400 Sub Total522,234 Contingency10.0%65,640 52,223 Total 722,040 Total 574,457 Additional Cost Over Doing the Work Entirely on the West SideExhibit A Packet Pg 1329 Reimbursable Improvement 6b - Phase 3 Orcutt Road East Side Improvements from Garay to HansenOrcutt East Side Road Improvement STA 23+85 TO 41+13Item Description Quantity Unit Unit Cost Total DiscussionUnit Cost. Additional To Work Entirely on the West SideTotal D1Mobilization1.00 LS 18,000.00 18,000 This is an additional charge over the West side construction because the East side work will be done at a different time than the West side development18,000.0018,0002Traffic Control1.00 LS 30,000.00 30,000 Same as above30,000.0030,0003East Side Road (per Xsec East Side) 1,728.00 LF 170.25 294,192 Road Cross Section:Cut Slope with Revegetation: The East side of Orcutt is cut into the slope and requires more recontouring work than the West sidea/c Dyke: The a/c dyke is an additional cost due to road improvement on the east sidePavement With Subbase: Pavement with sub-base is a cost that would occur if all work were on the west side (less 81.25/ft)Saw Cutting: The additional saw cut is entirely due to the work being done on the East sideStreet Grinding: The street grinding is entirely due to work being done on the East sideStriping: The striping is a cost that would occur if the work was done entirely on the West side (less 10.00/ft)79.00136,5124Intersection Blend Calla Crotalo1,160.00 SF 11.00 12,760 The intersection blend is entirely due to East side construction11.0012,7605Driveway Blend208.00 SF 11.00 2,288 The driveway blend is entirely due to East side construction11.002,2886a/c Dyke @ Int & Drv Blend168.00 LF 10.00 1,680 The driveway blend is entirely due to East side construction10.001,6807Vehicle Guardrail329.00 LF 75.00 24,675 The guardrail is entirely due to East side construction75.00 24,6758Lid Structure Mobilization1.00 EA 5,000.00 5,000 East side LID is entirely due to East side construction5,000.005,0009LID Structure Area2,055.00 SF 11.26 23,139 East side LID is entirely due to East side construction11.2623,13910LID Structure Perimeter633.00 LF 45.00 28,485 East side LID is entirely due to East side construction45.0028,48511LID Structure Excavation2.00 EA 1,000.00 2,000 East side LID is entirely due to East side construction1,000.002,00012LID Structure Under Drain Connection2.00 EA 1,000.00 2,000 East side LID is entirely due to East side construction1,000.002,00013LID Structure Landscaping2,055.00 SF 4.00 8,220 East side LID is entirely due to East side construction4.008,22014Culvert Const. Mobilization1.00 EA 15,000.00 15,000 Equipment mobilization on the East side is because the East side will be done at a different time than the West side15,000.0015,00015Culvert Excavation308.04 YD 50.00 15,402 This is entirely East side work50.0015,40216Culvert Headwall Footings884.00 SF 25.00 22,100 This is entirely East side work25.0022,10017Culvert Pipe Extension2.00 EA 4,000.00 8,000 If the work were to be done entirely on the West side the pipe extension on the West side would be longer and more expensive. Therefore there is little change in cost in with East side construction - 018Culvert Headwall Area990.00 SF 100.00 99,000 This is entirely East side work100.0099,00019Culvert RSP31.67 YD 150.00 4,750 This is entirely East side work150.004,75020Culvert Excavation Area Clean-Up/Re-Vegetation2,079.00 SF 5.00 10,395 This is entirely East side work5.0010,39521Retaining Wall Footings36.00 LF 25.00 900 This is entirely East side work25.0090022Retaining Wall Area180.00 SF 75.00 13,500 This is entirely East side work75.0013,50023Power Pole Bracing3.00 EA 5,000.00 15,000 This is entirely East side work5,000.0015,00024Mail Box Replacement1.00 EA 300.00 300 This is entirely East side work300.0030025Fence Replacement972.00 LF 50.00 48,600 This is entirely East side work50.00 48,600Sub Total 705,386 Sub Total 539,706 Design & Consultants15.0%105,808 80,956 Plan Check1.9%13,402 10,254 Inspection12.9%90,995 69,622 Sub Total 915,591 Sub Total700,539 Contingency10.0%91,559 70,054 Total 1,007,150 Total 770,592 Additional Cost Over Doing the Work Entirely on the West SideExhibit A Packet Pg 1339 Reimbursable Improvement 7 - Orcutt West Side Garay Frontage Improvements Orcutt Road West Side Frontage Improvement Item Description Quantity Unit Unit Cost Total 1 Mobilization 1.00 LS 25,000.00 25,000 2 Traffic Control 1.00 LS 30,000.00 30,000 3 West Side Road (per X-Sec A)470.00 LF 200.74 94,345 4 Intersection Blend (Tiburon & Calla Crotalo)SF 11.00 - 5 Driveway Blend 871.00 SF 6.00 5,226 6 a/c Dyke @ Int & Drv Blend LF 10.00 - Lid Structure Mobilization EA 5,000.00 - 7 LID Structure Area SF 11.26 - 8 LID Structure Perimeter LF 45.00 - 9 LID Structure Excavation EA 1,000.00 - 10 LID Structure Under Drain Connection EA 1,000.00 - 11 LID Structure Landscaping SF 4.00 - 12 Culvert Const. Mobilization 1.00 EA 15,000.00 15,000 13 Culvert Excavation 148.59 YD 50.00 7,430 14 Culvert Headwall Footings 358.00 SF 25.00 8,950 15 Culvert Pipe Extension 1.00 EA 6,000.00 6,000 16 Culvert Headwall Area 405.00 SF 100.00 40,500 17 Culvert RSP 13.00 YD 150.00 1,950 18 Culvert Excavation Area Clean-Up/Re-Vegetation 1,337.00 SF 7.00 9,359 19 Retaining Wall Footings LF 25.00 - 20 Retaining Wall Area SF 75.00 - 21 Power Pole Bracing 0.00 EA 5,000.00 - 22 Mail Box Replacement 1.00 EA 300.00 300 23 Fence Replacment 470.00 LF 25.00 11,750 Sub Total 255,810 Design & Consultants 15.0%38,372 Plan Check 1.9%4,860 Inspection 12.9%33,000 Sub Total 332,041 Contingency 10.0%33,204 Total 365,246 Exhibit A Packet Pg 134 9 Garay~45 SFRProjects1a,1b, 6b,7Taylor / Muick53 SFR67 MFRProjects1a,1b,2,3,4,5,6aWest Creek67 SFR105 MFRProjects1a,3Pratt(2), Evans, Anderson~239 MFRProjects2,3Righetti Hill Open Space and HomesiteFarrior / Hall~19 MFRProjects1a,1b,3Fiala~4 SFRProjects1a,1b,3Project Description 1a. Offsite Water Main from Johnson/Cedar Ct. to Johnson/Orcutt 1b. Offsite Water Main from Johnson/Orcutt to Orcutt/Tiburon 2.Water Main in Ranch House Rd from Tiburon to Sponza 3.Recycled Water Main From Tank Farm/Righetti Ranch to Ranch House/Sponza 4.Sanitary Sewer Main in Ranch House Rd. from Tiburon to Sponza 5.Intentionally Left Blank 6a.Orcutt Road East Side Improvements from Fiala Property to Garay Property 6b. Orcutt Road East Side Improvements from Garay Property to Hanson Lane 7.Orcutt Road West Side Fronting the Garay Property Ambient Breakdown:Tract 3066 (Jones) 14 SFR 52 MFRImel 17 SFR 0 MFRPratt(1), (024) 0 SFR 55 MFRTract 3063 Phase 1 151 SFR 0 MFRTract 3063 Phase 2 87 SFR 32 MFRTract 3063 Phase 3 34 SFR 0 MFRTOTALS 303 SFR 139 MFRORCUTTJOHNSONTANK FARMT I B U R O N HANSONBULLOCKNot A PartTract 3063 Phase 1(Ambient)151 SFRProjects1a,1b,3Tract 3063 Phase 2(Ambient)87 SFR32 MFRProjects1a,1b,3,6a,6bTract 3066 (Ambient)14 SFR52 MFRProjects1a,1b,2,3,6a,6bTract 3063 Phase 3(Ambient)34 SFRProjects1a,1b,6bIMEL(Ambient)17 SFRProjects1a,1b,3,6aPratt(1)(Ambient)55 MFRProjects1a,1b,2,3,6a,6bBENEFITING PARCELS MAP5/26/2017 9:12:20 AMK:\1 Ambient Projects\CA, SLO - Righetti Ranch\2016 03 02 Fare Share Agreement\Reimbursment Agreement\2017 05 01 Benefiting Parcels Map.rvtExhibit B Packet Pg 1359 RECLAIMED WATER MAIN (3) RECLAIMED WATERRighetti Ranch RoadTiburon Road Ranch House RoadSponza Righetti Ranch RoadOrcutt RoadWATER MAIN SEWER MAIN 1(a) & 1(b) WATER MAIN FROM CEDAR CT.6(a) ORCUTT EAST SIDE6(b) ORCUTT EAST SIDE(7) ORCUTT WEST SIDE FRONTING GARAY(4) SEWER MAIN(2) WATER MAIN Hanson ROAD FRONTAGE Tiburon Road Orcutt Road5/24/2017 2:29:44 PMK:\1 Ambient Projects\CA, SLO - Righetti Ranch\REVIT Files\Reimbursment Agreement\2017 05 01Reimbursment AgreementExhibit A V2017.rvt Excess Public Improvements Eligible for Reimbursement Ambient Reimbursement Agreement Packet Pg 136 9 Meeting Date: 6/20/2017 FROM: Garret Olson, Fire Chief Prepared By: Rodger Maggio, Fire Marshal SUBJECT: RESOLUTION AUTHORIZING THE COUNTY’S COLLECTION OF FIRE AND LIFE SAFETY INSPECTION FEES RECOMMENDATION Adopt a Resolution (Attachment A) enabling the continued collection of multi-dwelling property fire and life safety inspection fees via the secured property tax roll administered by the County. DISCUSSION In May 2005, the Council approved a cost recovery program for State-mandated fire and life safety inspections for multi-dwelling properties with three or more units. As part of this program, on June 7, 2005, the Council adopted Ordinance No. 1472 authorizing the collection of annual fees for these inspections through the secured County property tax roll as the most cost e fficient method for fee collection. In April, 2017, the Council approved Resolution No. 10790 revising, among other program fees, the fees for apartment buildings, hotels, condominiums, and fraternity/sorority houses as reflected in Exhibit A to the attached resolution. Staff is not recommending any further changes in the current fees for 2017-18. However, the County requires an annual resolution adopted by the Council authorizing the continued collection of these fees on the property tax roll. Staff is recommending that the fee collection continue to be done through the secured property tax roll in 2017-18 and is requesting that Council adopt the required resolution to authorize that collection. ENVIRONMENTAL REVIEW This action is a not a project under the California Environmental Quality Act. CONCURRENCES Finance & Information Technology Department concurs with the recommendation. FISCAL IMPACT In fiscal year 2016-17, the City is scheduled to collect $194,000. Projected revenue for fiscal year 2017-18 is $254,000. ALTERNATIVES 1. Do not adopt the resolution and direct staff to pursue alternative collection method. The secured tax roll is the most reliable method to recover inspection costs. Packet Pg 137 10 Attachments: a - Resolution multi Dwelling Program Fees 2017 Packet Pg 138 10 R ______ RESOLUTION NO. (2017 Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, AUTHORIZING THE SAN LUIS OBISPO COUNTY AUDITOR TO COLLECT FEES FOR 2017-18 FIRE AND LIFE SAFETY INSPECTIONS OF MULTI-DWELLING PROPERTIES CONTAINING THREE OR MORE DWELLING UNITS ON THE SECURED PROPERTY TAX ROLL PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTION 54988, ET SEQ. WHEREAS, the City of San Luis Obispo is required by California Health & Safety Code Section 17921 annually to inspect multi-dwelling properties containing three or more dwelling units, including apartments, certain residential condominiums, hotels, motels, lodging houses and congregate residences; and WHEREAS, California Health & Safety Code Section 13146.2 authorizes cities to charge property owners in recovering the reasonable costs of providing these annual inspections; and WHEREAS, in accordance with this policy, the Council adopted Resolution Nos. 9799 (2006 Series) and 10790 (2017 Series) updating the master fee schedule, as specifically set forth in “Exhibit A” hereto, and authorizing the collection of these fees on the secured property tax roll; and WHEREAS, the Council desires to continue collection of these fees on the secured property tax roll for 2017-18: NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. Pursuant to California Health & Safety Code Section 13146.2(b) and Municipal Code Section 3.50, the Council hereby authorizes and directs that Fire and Life Safety Inspection fees shall be collected on the secured property tax roll by the San Luis Obispo County Auditor-Controller for fiscal year 2017-18. A listing of fees by assessor’s parcel number shall be provided to the County Auditor-Controller for collection on the 2017-18 secured property tax roll in accordance with their schedule and data format requirements, pursuant to California Government Code 54988, et seq. Upon motion of , seconded by , and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted on this ______ day of ______2017. Packet Pg 139 10 Resolution No. _____ (2017 Series) Page 2 R ______ ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 140 10 Resolution No. _____ (2017 Series) Page 3 R ______ EXHIBIT A Multi-Dwelling Fire and Life Safety Inspection Fee Schedule Administrative Fee Processing per facility $86.51 Each Additional Owner $10.27 Apartment Houses Up to 10 Units $346.06 11- 20 Units $519.09 21- 50 Units $692.12 51- 100 Units $865.15 101- 200 Units $1384.24 Every additional 100 Units over 200 $348.08 Condominiums Up to 10 Units $346.06 11- 20 Units $519.09 21- 50 Units $692.12 51- 500 Units $1038.18 Fees are waived for units that are built, owned and managed by the San Luis Obispo Housing Authority, other governmental agencies or not-for-profit housing organizations. Hotels, Motels, Lodging Houses, Bed & Breakfast Facilities, Youth Hostel Facilities, Senior Facilities, Sororities, Fraternities and Other Congregate Residences 1 - 20 units $346.06 per year per facility 21 - 50 units $519.09 per year per facility 51-100 units $865.15 per year per facility 101-200 units $1384.24 per year per facility Sorority, Fraternity, Congregate house $692.12 These fees are applicable to all multi-dwelling units in the City based on the following definitions as set forth in the 2016 California Building Code, Chapter 2: Definitions and Abbreviations, Section 202 and Chapter 3, Section 310. Apartment house is any building, or portion thereof, which contains three or more dwelling units, including R-2 residential condominiums. Packet Pg 141 10 Resolution No. _____ (2017 Series) Page 4 R ______ Congregate residences are any building or portion thereof that contains facilities for living, sleeping and sanitation, as required by this code, and may include facilities for eating and cooking, for occupancy by other than a family. A congregate residence may be a shelter, convent, monastery, dormitory, fraternity or sorority house, but does not include jails, hospitals, nursing homes, hotels, or lodging houses. Dwelling unit is any building or portion thereof that contains living facilities, including provisions for sleeping, eating, cooking and sanitation, as required by this code, for not more than one family, or a congregate residence for ten or less persons. Hotel is any building containing six or more guest rooms intended or designed to be use, or which are used, rented or hired out to be occupied, or which are occupied for sleeping purposes by guests. Lodging house is any building or portion thereof containing not more than five guest rooms where rent is paid in money, goods, labor or otherwise. (A lodging house includes bed & breakfast facilities and hostels, but excludes single family dwellings). Motel shall mean the same as hotel as defined in this code. Packet Pg 142 10 Meeting Date: 6/20/2017 FROM: Daryl R. Grigsby Prepared By: Bryan Wheeler and Matt Crisp SUBJECT: MONTEREY/OSOS TRAFFIC SIGNAL INSTALLATION, SPECIFICATION NO. 91377 RECOMMENDATION 1. Approve Plans and Specifications for the “Monterey/Osos Traffic Signal Installation Project, Specification No. 91377,” and authorize staff to advertise for construction bids; and 2. Authorize the City Manager to award a contract if the total of the bid plus contingency is within the available project at time of award; and 3. Approve the transfer of $191,000 from various Public Works Transportation accounts to the Monterey/Osos Traffic Signal Installation Project account. DISCUSSION Background The annual Traffic Safety Report (“Report”) identified the intersection of Monterey and Osos as a high collision rate intersection with correctable measures available. Red light violations in all directions was the pattern of collision identified at the intersection and the Report recommended signal mast arms to enhance visibility. The initial CIP funding for the project, as requested in the 2015-2017 Financial Plan, did not anticipate significant street work necessary for the project. During the design phase of this project, all four corners of the intersection were identified for replacement particularly to address tree root intrusion on one corner. Utility conflicts and limited space at the corners of the intersection require the antiquated signal and streetlight pole foundations to be removed and new signal pole foundations to be installed in the same locations. Each corner must then be reconstructed. This practice is not commonly used because space is usually utilized adjacent to existing foundations that does not require significant disruption of the corner. State and Federal standards for pole placement and existing underground conflicts limit the poles to their existing locations. The existing signal poles and foundations cannot be utilized, as they are well older than current standards, and cannot be upgraded in their current configuration. This increase in estimated project cost reflects increases in labor and materials for the project. The project also includes ADA improvements on the southeast corner of the intersection. A Ficus tree has created significant vertical displacement of the sidewalk. This disruption is identified as problematic by the Engineering Department and requires temporary fixes to reduce trip hazards. The Tree Committee approved the removal of the 36” box size Ficus tree located near the intersection on January 26, 2016. The public notice requirement was followed and there Packet Pg 143 11 was no appeal of the committee’s decision. The removal was conditional upon the reinstallation of a 36” box size Ficus tree near the same location which is being proposed with this project. CONCURRENCES The Monterey and Osos Traffic Signal upgrades have been identified as a mitigation measure to address the collision rates at the intersection in the Traffic Safety Reports completed in 2013, 2014, and 2015. The project is also identified in the 2015-17 Financial Plan. ENVIRONMENTAL REVIEW The project is Categorically Exempt from environmental review pursuant to CEQA Guidelines Section 15304(i) (Class 2 – Replacement or reconstruction; replacement or reconstruction of existing structures and facilities where the new structure will be located on the same site as the structure replaced and will have substantially the same purpose and capacity as the structure replaced). Upon approval of this item, and before bid solicitation, a Notice of Exemption will be filed through the Community Development Department. Packet Pg 144 11 FISCAL IMPACT The Monterey and Osos Traffic Signal Installation project is identified in the 2015-17 Financial Plan, Capital Improvement Plan, on Page F-29. This project is a Local Revenue Measure funded project. The original budget request was in the amount of $225,000. There is currently a balance of $217,600 remaining in the construction phase available for this project. Staff recommends the transfer of funds from various completed project and transportation accounts in the amount of $191,000, the estimated project cost of $375,000. The project’s estimated construction costs are shown below: Monterey/Osos Traffic Signal Installation, Specification No. 91377 Construction Costs $375,000 Construction Contingencies $33,000 Total for Construction $408,000 Available Funding $217,600 Funding difference -$191,000 The increase in construction costs are due to constraints discovered during the design of the project. A communications vault and fiber optic line was discovered in the area during survey of the intersection. Additionally, adjacent buildings on two corners have basements located underneath the city sidewalk. These obstructions prevent the new signal poles to be in others areas except for the existing streetlight pole locations. The process to remove the existing streetlight pole foundation and install a new signal pole and foundation is longer than a normal signal installation, resulting in increased contractor time and cost. Additionally, as part of the project, several ADA upgrades are being performed to bring the sidewalks within acceptable accessibility conditions. The southeast corner of the project must be completely reconstructed with this signal installation, due to extensive tree root damage in the sidewalk area. Staff recommends the transfer of funds to the project’s construction account. A Budget Amendment Request will transfer $191,143 from various Public Works – Transportation (50500) accounts to the Monterey/Osos Traffic Signal In stallation project account. The project accounts that funds are being transferred from are completed projects or master accounts for which the projects identified have been completed. These transfers provide sufficient funding to support project construction and of an 8% construction contingency. A fiscal impact summary of funding sources is provided below. Several of these accounts are Local Revenue Measure accounts, and are also indicated below. Fiscal Impact Summary Fund Account Phase Balance (to transfer) Account 101 90398 953 $7,508.94 Safety Report Implementation (Measure G) 400 90398 953 $12,536.96 405 90398 953 $210.00 Packet Pg 145 11 400 91321 953 $277.20 Downtown Lighted Crosswalks 400 91321 954 $3,500.00 401 90872 953 $48,477.00 General Traffic Signal Improvements (Measure G) 400 90849 953 $35,000.00 Sidewalk and Tree Replacement 401 91295 952 $83,633.06 Traffic Safety and Operations (Measure G) Costs By Type ALTERNATIVES 1. Deny Authorization to Advertise and direct staff to redesign the project within the available existing budget. This is not recommended as the ADA curb ramp upgrades must also occur at the location. 2. Deny authorization to advertise. The City Council may choose not to authorize project advertisement. This is not recommended since the project has been identified as a necessary project in the Traffic Safety Report. Attachments: a - Council Reading File - Plans 91377 b - Council Reading File - Specials 91377 Packet Pg 146 11 Meeting Date: 6/20/2017 FROM: Xenia Bradford, Interim Director of Finance Prepared By: Rico Pardo, Accounting Manager/Controller SUBJECT: APPROPRIATIONS LIMIT FOR 2017-18 RECOMMENDATION Adopt a resolution establishing the City’s appropriations limit for 2017-18. DISCUSSION Overview The Appropriations Limit imposed by Propositions 4 (also known as the Gann Spending- Limitation Initiative or the Gann Initiative, “Limit”) and 111 create a restriction on the amount of revenue which can be appropriated in any fiscal year. The Limit is based on actual appropriations during the base year (1986-87 or the first full year of operation), and increase each year using specified growth factors. Not all revenues are restricted by the Limit, only those which are referred to as “proceeds of taxes.” In addition, proceeds of taxes are allowed to be spent on several types of appropriations which do not count against the Limit. The law allows a city to appropriate funds for certain expenses that are deemed to be exempt from the Limit. Among these exempt expenditures are “qualified capital outlays,” voter approved debt service, court orders and federal mandates. Qualified capital outlay represents an expenditure for an asset, which may include land having a useful life of 10 or more years and a cost of at least $100,000. Annually, the City is required to adopt a resolution setting an appropriations limit for the upcoming fiscal year. For 2017-18, staff projects that the City’s appropriations limit will be $72.6 million, while the appropriations subject to the limit total $50.0 million. Key Concepts As discussed above, the Gann Spending-Limitation Initiative provides for the limitation of state and local government appropriations. It is important to note that the Limit is actually a limitation on tax revenues rather than a direct limitation on appropriations. Below is a summary of the major provisions of the Gann Initiative and Proposition 111 modifications: 1. Appropriations subject to limitation may not exceed appropriations made in 1986-87, except as adjusted for increases in the cost of living, population and service responsibility transfers. 2. Appropriations financed through service fees (to the degree that they do not exceed the cost of performing the service), grant programs, fines and forfeitures, and other specified “non- tax” sources are not subject to the appropriations limit. Additionally, appropriations for long- term indebtedness incurred prior to 1986-87, debt service on qualified capital outlays beginning in 1990-91, qualified capital outlays in excess of $100,000 and increased costs as a Packet Pg 147 12 result of federally-mandated programs, are also excluded from the limit. Essentially, with the exception of major capital-related expenditures, all appropriations funded through tax revenues are subject to limitation. 3. For the purpose of identifying “proceeds from taxes” under the Gann Initiative, state subventions that are unrestricted as to their use (such as motor vehicle in -lieu revenues) are considered to be tax sources. On the other hand, the use of subventions like gas tax and transportation development act funds is restricted by the State and, as such, is classified as non-tax sources. 4. Under the original Gann Initiative, all proceeds from taxes received in excess of the appropriations limit were required to be returned through refunds or revisions in tax rates and fee schedules within the next two fiscal years; or voter approval to increase the appropriations limit was required. Proposition 111 provides a one-year carryover feature to determine excess revenues under which refunds can be avoided if in the subsequent year the City is below the limit by the amount of the prior year excess. Any voter-approved increase to the appropriations limit cannot exceed four years. 5. Originally, the Gann Initiative was self-executing, requiring no formal review; however, Proposition 111 requires that the annual calculation be reviewed as part of the annual financial audit. 6. Major concepts in implementing the Gann Initiative as modified by Proposition 111 include: appropriations funded through tax sources are subject to the limit, not actual expenditures; and any excess of actual tax revenues over the appropriations limit, not actual expenditures or appropriations, are subject to refund. Estimated Appropriations Subject to Limit The estimated appropriations subject to limit is based on calculation of proceeds from taxes, including interest, less qualified exclusions to yield the estimate. Proceeds of taxes are primarily comprised of the City’s proceeds on sales tax, local revenue measure, transient occupancy tax, utility users tax, and property tax. Interest is also applied to those tax proceeds. Exclusions are comprised of qualified capital outlay and qualified debt service. Qualified capital outlay represents an expenditure for an asset, which may include land having a useful life of 10 or more years and a cost of at least $100,000. Qualified debt service is voter approved debt service. The City’s qualified capital outlay consists of general purpose CIP and improvement projects funded by local revenue measure while qualified debt consists of the City’s long term bonds and leases. Packet Pg 148 12 The calculation appears as follows: Estimated Appropriations Subject to Limit Proceeds from taxes 56,141,501 Interest earnings 141,647 Total proceeds from taxes and interest $56,283,148 Qualified capital outlay 3,002,000 Qualified debt service 3,244,757 Less: Exclusions 6,246,757 Estimated Appropriations Subject to Limit $50,036,391 Adjustment Factors The annual adjustment factors for changes in population and cost of living for the appropriations limit calculation must be selected by a recorded vote of the Council and includes the following: 1. Population. Based on data provided annually by the State Department of Finance, cities may annually choose either the growth in their city’s or the county’s population. For this year’s calculation, the County’s 0.92% population growth factor (which exceeded the City's factor) is the recommended adjustment factor as discussed below. 2. Cost of living. Local governments may annually choose either the percentage change in California per capita personal income or the percentage change in their jurisdiction's assessed valuation that is attributable to non-residential new construction depending on which one provides the greatest increase to the appropriation limit. For the 2017-18 calculation, use of the annual change in non-residential assessed valuation of 8.20% resulted in a higher appropriation limit value than was obtained using the per capita personal income annual change. Packet Pg 149 12 Calculation Summary A summary of the City’s appropriations limit history is provided in Attachment B. As reflected in that summary, the City’s limit for 2017-18 is $72,562,034 calculated as follows: Appropriations Limit Calculation 2016-17 Appropriations Limit $66,451,524 Adjustment Factors A. Cost of Living Option Percentage change in assessed value in the preceding year due to new non-residential construction [% + 100/100] 1.0820 B. Population Option Percentage change in County population [% + 100/100] x 1.0092 Compound Percentage Factor (multiplicative not additive) [A x B] 1.092% Total Adjustment [PY Appropriations Limit x Compound % Factor] $6,110,510 2017-18 Appropriations Limit = [2016-2017 Limit x Compound % Factor] $72,562,034 ENVIRONMENTAL REVIEW The recommended actions are not a project as defined under the California Environmental Quality Act. CONCURRENCES The Limit calculation is based on the requirements of the California Constitution and implementing statutes. FISCAL IMPACT Under Article XIII B to the California Constitution as amended, the City is required to adopt the Appropriation Limit each year. As a result of the appropriations subject to the li mit being well below the calculated Limit for 2017-18 as shown below, no adjustments are required to be made to the proposed expenditures contained within the Preliminary Financial Plan. The following summarizes the variance between the City’s appropriations limit and the projected appropriations subject to this limit for 2017-18: 2017-18 Value Appropriations Limit $72,562,034 Estimated Appropriations Subject to Limit $50,036,391 Favorable Variance $22,525,643 Packet Pg 150 12 ALTERNATIVES The City must adopt a Limit for each Fiscal Year and the formula for calculating the Limit is determined by law. Attachments: a - Appropriations Limit Resolution 2017-18 b - Appropriations Limit History Packet Pg 151 12 R _____ RESOLUTION NO. (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, ADOPTING THE APPROPRIATIONS LIMIT FOR 2017-18 WHEREAS, the voters approved the Gann Spending-Limitation Initiative on November 6, 1979 and Proposition 111 on June 5, 1990, which establish and define annual appropriation limits on state and local government agencies; and WHEREAS, regulations require that the governing body of each local agency establish its appropriations limit and annual adjustment factors by resolution; and WHEREAS, the required calculations to determine the City’s appropriations limit, and estimated appropriations subject to limitation for 2017-18, have been performed by the Department of Finance & Information Technology and are available for public review. NOW, THEREFORE, BE IT RESOLVED that the Council of the City of San Luis Obispo hereby adopts the City’s appropriations limit and annual adjustment factors for 2017-18 as follows: Appropriations Limit Calculation 2016-17 Appropriations Limit $66,451,524 Adjustment Factors A. Cost of Living Option Percentage change in assessed value in the preceding year due to new non-residential construction [% + 100/100] 1.0820 B. Population Option Percentage change in County population [% + 100/100] x 1.0092 Compound Percentage Factor (multiplicative not additive) [A x B] 1.092% Total Adjustment [PY Appropriations Limit x Compound % Factor] $6,110,510 2017-18 Appropriations Limit = [2016-2017 Limit x Compound % Factor] $72,562,034 Upon motion of ___________________________, seconded by ___________________, and on the following roll call vote: AYES: NOES: ABSENT: Packet Pg 152 12 Resolution No. (2017 Series) Page 2 R _____ The foregoing resolution was adopted this 20th day of June 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this 20th day of June 2017. ____________________________________ Carrie Gallagher City Clerk Packet Pg 153 12 BUDGET REFERENCE MATERIALS APPROPRIATIONS LIMIT HISTORY The Gann Spending Limit Initiative , a Stateconstitutional amendment adopted by the voters on June 6, 1979, restricts appropriations from tax revenues by State and local governments. Under its provisions, no local agency can appropriate proceeds of taxes in excess of its "appropriations limit." Excess funds may be carried over into the next year. However, any excess funds remaining after the second year must be returned to taxpayers by reducing tax rates or fees; a majority of the voters may approve an override to increase the limit. The following summarizes changes in the City's appropriations limit and appropriations subject to the limit since the effective date of the initiative. While there are exceptions, in general, the City's appropriations limit increases annually by compound changes in cost-of-living and population. This summary also reflects changesmade by Proposition 111 (adopted in June 1990) in determining the appropriations limit as well as the appropriations subject to it.Appropriations AppropriationsLimit Subject to LimitPost-Proposition 1111987-88 14,836,300 3.47%2.93%15,800,900 14,411,700 1,389,2001988-89 15,800,900 4.66%4.10%17,215,200 15,223,500 1,991,7001989-90 17,215,200 5.19%3.92%18,818,600 16,691,800 2,126,8001990-91 18,818,600 4.21%4.59%20,511,000 15,005,400 5,505,6001991-92 20,511,000 4.14%3.04%22,009,500 14,911,100 7,098,4001992-93 22,009,500 -0.64%1.00%22,087,300 18,094,900 3,992,4001993-94 22,087,300 2.72%1.86%23,110,100 15,215,000 7,895,1001994-95 23,110,100 0.71%1.40%23,600,000 16,778,400 6,821,6001995-96 23,600,000 4.72%1.60%25,109,300 15,530,800 9,578,5001996-97 25,109,300 4.67%2.31%26,889,000 16,825,500 10,063,5001997-98 26,889,000 4.67%2.06%28,724,500 17,513,200 11,211,3001998-99 28,724,500 4.15%2.70%29,671,300 17,291,800 12,379,5001999-00 29,671,300 4.53%2.28%31,717,100 18,030,500 13,686,6002000-01 31,717,100 4.91%2.46%34,093,000 18,802,000 15,291,0002001-02 34,093,000 0.33%1.80%34,821,200 23,227,900 11,593,3002002-03 34,821,200 0.33%1.80%35,565,000 23,018,400 12,546,6002003-04 35,565,000 2.31%1.32%36,866,700 23,072,400 13,794,3002004-05 36,866,700 3.28%1.15%38,513,100 27,670,400 10,842,7002005-06 38,513,100 5.26%1.19%41,021,300 32,371,900 8,649,4002006-07 41,021,300 3.96%0.73%42,957,100 30,757,100 12,200,0002007-08 42,957,100 4.42%0.96%45,286,400 36,582,900 8,703,5002008-09 45,286,400 4.29%1.12%47,758,200 36,795,300 10,962,9002009-10 47,758,200 0.62%1.01%48,540,600 27,159,400 21,381,2002010-11 48,540,600 -2.54%0.87%47,719,200 32,058,100 15,661,1002011-12 47,719,200 2.51%0.83%49,323,000 34,229,700 15,093,3002012-13 49,323,000 3.77%0.47%51,423,500 44,178,300 7,245,2002013-14*51,423,500 5.12%0.52%54,337,500 40,104,100 14,233,4002014-15*54,337,500 8.69%0.09%59,112,600 36,642,900 22,469,7002015-16*59,112,600 4.97%0.78%62,534,500 46,067,700 16,466,8002016-17*62,534,500 5.63%0.60%66,451,500 49,397,200 17,054,3002017-18*66,451,500 8.20%0.92%72,562,034 50,036,391 22,525,643(*) The cost of living factor is based on the increase in non-residential assessed values VarianceFiscal Year Limit Base Cost-of-Living Factor Population Factor $0$8$15$23$30$38$45$53$60$68$75$83 20082009201020112012201320142015201620172018MillionsFiscal Year Ending Appropriations Limit: 2007-08 to 2017-18 Appropriations Limit Appropriations Subject to Limit Packet Pg 154 12 Meeting Date: 6/20/2017 FROM: Katie Lichtig, City Manager Prepared By: Xenia Bradford, Interim Finance Director SUBJECT: ADOPTION OF 2017-19 FINANCIAL PLAN RECOMMENDATION Adopt a resolution approving the 2017-19 Financial Plan as amended with the changes shown in Exhibit 1 of the recommended resolution (Attachment A). DISCUSSION After extensive community participation and nine Council budget workshops and hearings beginning in November 2016, the 2017-19 Financial Plan is ready for adoption. Key features of the upcoming two-year Financial Plan include: Focus on long-term fiscal health, aligned with Fiscal and Budget Policies, Financial Responsibility and Sustainability Philosophy, and Fiscal Health Contingency Plan. Aligned with Council adopted Major City Goals and Other Important Objectives. Ensures that the fund balance and working capital policy requirements are met. Invests in the future by funding maintenance of existing infrastructure and invest in capital improvement program. Addresses current required payments to unfunded liabilities. Honors and implements Local Revenue Measure priorities. The 2017-19 Financial Plan includes city-wide Financial Plan allocations for the two-year period in the amounts as summarized below: 2015-17 Financial Plan 2015-16 2016-17 Operating Programs $ 99,480,759 $ 101,439,423 Capital Improvement Plan 34,574,100 92,810,617 Debt Service 7,969,872 8,860,368 TOTAL $142,024,731 $203,110,408 Although the City adopts a two-year Financial Plan, the budget (also known as appropriations) is adopted annually under the process. Pursuant to Section 8041 of the City Charter, the City Council must adopt the 2017-18 Budget by June 30, 2017 in order for appropriations to be in 1 Section 804. Adoption of the Budget. After the conclusion of the public hearing the Council shall further consider the proposed budget and make any revisions ther eof that it may deem advisable and thereafter it shall adopt the budget with revisions, if any. Upon final adoption, the budget shall be in effect for the ensuing fiscal year. From the effective date of the budget, the several amounts stated therein as proposed expenditures shall be and become appropriated to the various departments or activities therein described. All appropriations shall lapse at the end of the fiscal year to the extent that they shall not have been expended or lawfully encumbered. At any meeting after the adoption of the budget, the Council may amend or supplement th e budget by motion adopted by a majority vote of the Council. Packet Pg 155 13 place for the 2017-2018 fiscal year which begins on July 1. T his is accomplished by resolution and a Budget Resolution is provided as Attachment A to this report. Changes to the Preliminary Financial Plan In preparing for the adoption of the Financial Plan at this meeting, the City Council has held two budget workshops and hearings on June 1st and 6th, 2017. During those workshops, several budget changes were directed as displayed in the Exhibit 1 to the Resolution (Attachment A). Final Documents After Council adoption of the 2017-19 Financial Plan, a copy of the Adopted 2017-19 Financial Plan will be posted on-line. Additionally, staff will prepare a Budget-in-Brief that highlights the City's budget process, key budget features, major City goals and basic “budget facts.” This budget summary is widely distributed: it will be available at all public counters, included with the utility billings in August and published on the City’s website. With this broad distribution, it will also meet the Measure G reporting commitments to the community on the use of these funds. Ongoing Monitoring Adoption of the Financial Plan is the beginning of a continuous financial management process. Ongoing monitoring efforts include: 1. Interim Financial Reports. On-line access to up-to-date financial information is provided to staff throughout the organization. Additionally, financial reports are prepared monthly to monitor the City’s fiscal condition, and a concise but comprehensive report is issued on a quarterly basis. These are complemented by special reports such as the quarterly Sales Tax Newsletter, Monthly TOT Report and Quarterly Investment Report. 2. Goal Status Reports. Formal reports are provided to the Council on status of Major City Goals, other important objectives and major Capital Improvement Plan projects at specific intervals during the year: with the Mid-Year Budget Review and again in September of the second year of the Financial Plan. These reports are prepared in addition to ongoing updates through Agenda reports, Council Notes, and other special reports. The report will also include progress in meeting new performance measures that were added with the financial plan. FISCAL IMPACTS As outlined in detail in the Financial Plan, the city is allocating $347.1 million over a two year period from July 1, 2017 to June 20, 2019. Revenue and expenditures for all Funds are balanced in this Financial Plan. Packet Pg 156 13 Attachments: a - Final Budget Resolution 2017-19 b - Exhibit 1 c - Attachment A to Exhibit 1 d - Attachment B to Exhibit 1 e - Attachment C to Exhibit 1 Packet Pg 157 13 R ______ RESOLUTION NO. (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING THE 2017-19 FINANCIAL PLAN AND 2017-18 BUDGET WHEREAS, in accordance with San Luis Obispo Charter Section 802, the City Manager has submitted the 2017-19 Financial Plan to the Council for its review and consideration consistent with budget policies and objectives established by the Council; and WHEREAS, the 2017-19 Financial Plan is based upon extensive public comment and direction of the Council after scheduled budget workshops and public hearings held on June 1st and June 6th. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. The Preliminary 2017-19 Financial Plan, amended for the items listed in Exhibit 1 (including attachments A, B, C to the Exhibit), which is incorporated by reference herein, is hereby approved and the operating, debt service and capital improvement plan budget for the fiscal year beginning July 1, 2017 and ending June 30, 2018 is hereby adopted. SECTION 2. The Budget and Fiscal Policies included in the Preliminary 2017-19 Financial Plan and amended as shown in Exhibit 1 are hereby approved. SECTION 3. The City Manager is hereby delegated authority to approve budget adjustments for budget allocations earmarked by the Council action for specific purpose during 2016-17 fiscal year to be expended during 2017-18. SECTION 4. The City Manager is hereby delegated the authority to approve format and typographical changes found within the Preliminary 2017-19 Financial Plan as needed. Upon motion of ___________________, seconded by _______________________, and on the following roll call vote: AYES: NOTE: ABSENT: The foregoing resolution was adopted this June 20th day of 2017. ______________________________ Mayor Heidi Harmon Packet Pg 158 13 Resolution No. _____ (2017 Series) Page 2 R ______ ATTEST: Carrie Gallagher City Clerk APPROVED AS TO FORM: J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 159 13 EXHIBIT 1 – CHANGES OT THE PRELIMINARY BUDGET I. Amend Preliminary 2017-19 Financial Plan based on Council direction from June 1, 2016 Budget Hearing as follows: 2017-18 2018-19 Decrease Transfer-Out from Parkland Development Fund to General Fund Parkland Development Fund Transfer-Out -480,000 General Fund Transfer-In -480,000 Increase General Capital Outlay Sources for SB 1 Revenue SB 1 – Road Repair and Accountability Revenue 318,000 180,000 Increase General Capital Outlay Fund Expenditure Safe Routes to School Capital Improvement Project 268,000 Decrease General Capital Outlay Fund Expenditure Safe Routes to School -250,000 II. Amend Preliminary 2017-19 Financial Plan to correct typographical error in Fiscal and Budget Policies as follows: Page B1-9 corrected. D. Cost of Service Fees. The City will treat the water and sewer funds in the same manner as if they were privately owned and operated. This means assessing reasonable cost of service fees in fully recovering service costs. The purpose of the cost of service fee is reasonable cost recovery for the use of the city’s services such as street rights-of-way and public safety. The appropriateness of charging the water and sewer fund a reasonable cost of service fee for the use of the City streets is further supported by the results of studies Arizona, California, Ohio, and Vermont which concluded that the leading cause of street resurfacing and reconstruction is street cuts and trenching for utilities. Packet Pg 160 13 III. Amend Preliminary 2017-19 Financial Plan financial schedules to reflect the Council Direction from June 1, 2016 Budget Hearing and to reflect corrections as follows: Attachment A – Replace page A1-30 Attachment B – Replace pages A1-51, E1-9 through E1-16 Attachment C – Replace pages G1-5 through G1-39 Packet Pg 161 13 General Fund Five Year Fiscal Forecast 2017-19 Financial Plan #REF! $ in 000's Actual Revised 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 2021-22 1 Sales Tax 17,498 16,584 16,932 17,277 17,186 17,659 18,170 2 Measure Y/G Sales Tax 7,178 7,391 7,607 7,679 7,636 7,790 7,959 3 Sales Tax Prop 172 405 428 437 445 445 454 463 4 Property Taxes 10,187 10,767 10,950 11,607 12,245 12,858 13,501 5 Property Tax in Lieu of VLF 4,113 4,365 4,593 4,846 5,088 5,343 5,610 6 Transient Occupancy Tax 7,113 7,186 7,294 7,440 7,663 8,008 8,368 7 Utility Users Tax 5,414 5,506 5,568 5,617 5,690 5,779 5,870 8 Franchise Fees 1,538 1,540 1,527 1,527 1,527 1,527 1,527 9 Business Tax 2,492 2,500 2,747 2,884 3,028 3,180 3,339 10 Real Property Transfer Tax 366 373 381 388 396 404 412 11 Subtotal Taxes 56,304 56,640 58,035 59,711 60,906 63,001 65,219 12 Transfers In (Gas, TDA, CoS, Other)2,924 2,353 3,876 3,539 2,377 2,377 2,377 13 Other Subventions & Grants 1,539 316 316 316 316 316 316 14 Development Review Fees 5,624 5,647 6,154 5,981 6,068 6,188 6,311 15 Recreation Fees 1,759 1,640 1,810 1,846 1,883 1,921 1,959 16 Other Service Charges 1,952 1,750 1,633 1,657 1,682 1,707 1,733 17 Other Revenues 891 543 543 543 543 543 543 18 Subtotal Non-Tax Revenues 14,689 12,249 14,331 13,882 12,868 13,051 13,238 19 Total Resources 70,993 68,889 72,367 73,593 73,774 76,052 78,457 20 Operating Expenses (excl PERS)2 46,223 49,548 50,906 50,817 53,147 54,349 55,665 21 PERS Normal Costs 3,612 3,866 3,058 3,020 3,080 3,157 3,236 22 PERS Unfunded Liability 5,629 6,871 8,134 9,330 10,591 11,416 12,264 23 PERS Discount Rate Adjustment 375 802 1,896 2,550 24 Subtotal: Operating Expenses 55,464 60,285 62,098 63,542 67,620 70,818 73,716 25 Debt Service 3,025 3,246 3,245 3,241 2,795 2,391 2,391 26 Transfer to CDBG 147 154 154 154 154 154 154 27 Transfer to Insurance Benefit Fund 2,124 1,740 750 500 - - - 28 Transfer to Parkland Development Fund 900 29 CIP - Fleet Replacement 384 - 674 508 485 500 500 30 CIP - IT Replacement 617 2,621 639 1,136 525 551 579 31 CIP - Major Facility Replacement 146 505 768 550 855 917 962 32 CIP - All Other & Local Measure Funded projects)3,329 6,507 3,870 3,977 3,502 3,550 3,728 33 Subtotal: Operating Transfers 9,773 15,673 10,100 10,066 8,316 8,063 8,314 #REF! 34 Total Expenditures 65,237 75,958 72,198 73,608 75,937 78,881 82,029 35 Resources Over/(Under) Expenses 5,757 (6,869) 169 (15) (2,163) (2,829) (3,572) 36 Fund Balance, Beginning of Year 24,566 21,539 14,181 14,350 14,335 12,172 9,343 37 Nondispensable/Restricted/ Committed (8,074) (489) - - - - - 38 Funding Adjustment (709) - - - - - 39 Ending Fund Balance 21,539 14,181 14,350 14,335 12,172 9,343 5,771 40 Reserve @ 20% Operating Costs (11,476) (10,851) (10,708) (10,767) (11,245) (11,501) (11,780) 41 Designated Reserve - - - - - 42 Reserve Over/(Under) Policy Level 10,063 3,330 3,642 3,567 927 (2,158) (6,009) Five Year Forecast 17-19 Financial Plan Attachment A to Exhibit 1 Packet Pg 162 13 FUND 2017-18 2018-19Airport Area Impact Fee 55,000$ 750,000$ Community Development Block Grant Fund 105,000$ -$ Fleet Replacement Fund 495,000$ 434,000$ General CIP Grant Fund 1,020,000$ 13,607,453$ General Purpose CIP 214,000$ 358,547$ Information Technology Replacement Fund 304,000$ 1,294,294$ Local Revenue Measure Sub-Fund 5,076,700$ 5,002,323$ Major Facility Replacement Fund 52,200$ 144,200$ Parking Fund 825,000$ 650,000$ Parkland Development Fund 85,000$ 179,000$ Public Art Fund 124,700$ 126,700$ Sewer Fund 22,042,500$ 58,162,000$ Transit Fund 335,000$ 1,085,000$ Transportation Impact Fee 310,500$ 1,369,000$ Water Fund 3,277,500$ 9,362,100$ Whale Rock Fund 520,000$ 36,000$ TOTAL 34,842,100$ 92,560,617$ CAPITAL IMPROVEMENT PLAN - SUMMARY BY FUND Airport Area Impact Fee1% Community Development Block Grant Fund0% Fleet Replacement Fund1% General CIP Grant Fund11% General Purpose CIP0%Information Technology Replacement Fund1% Local Revenue Measure Sub-Fund8%Major Facility ReplacementFund0%Parking Fund1%Parkland Development Fund0% Public Art Fund0%Sewer Fund63% Transit Fund1% Transportation Impact Fee1%Water Fund10% Whale Rock Fund0% 2017-19 CIP by FUND Attachment B to Exhibit 1 Packet Pg 163 13 2017-18 2018-19 2019-20 2020-21 2021-22 Airport Area Impact Fee 55,000$ 750,000$ -$ -$ -$ Airport Area Impact Fee Total 55,000$ 750,000$ -$ -$ -$ State or Federal Grant 105,000$ -$ 250,000$ 250,000$ 250,000$ CDBG Fund Total 105,000$ -$ 250,000$ 250,000$ 250,000$ Debt Financing 465,000$ 359,000$ -$ 410,000$ -$ Fleet Replacement Fund 30,000$ 75,000$ General Capital Outlay -$ -$ 784,000$ 519,000$ 522,000$ Fleet Replacement Fund Total 495,000$ 434,000$ 784,000$ 929,000$ 522,000$ State or Federal Grant 600,000$ 13,327,453$ -$ 390,500$ 16,380,600$ SB-1 318,000$ 180,000$ -$ -$ -$ Zone 9 - County Grant 102,000$ 100,000$ 100,000$ 100,000$ 100,000$ General CIP Grant Fund Total 1,020,000$ 13,607,453$ 100,000$ 490,500$ 16,480,600$ Developer Contribution -$ 97,547$ 1,350,000$ General Capital Outlay 214,000$ 261,000$ 3,786,780$ 3,514,500$ 3,690,700$ General Purpose CIP Total 214,000$ 358,547$ 5,136,780$ 3,514,500$ 3,690,700$ General Capital Outlay 189,255$ 1,078,977$ 525,000$ 550,968$ 579,000$ Parking Fund 6,633$ 18,854$ 4,069$ 633$ 9,749$ Sewer Fund 14,923$ 71,780$ 307,876$ 4,260$ 25,873$ State or Federal Grant 65,000$ -$ -$ -$ -$ Transit Fund 3,317$ 56,570$ 2,035$ 982$ 2,248$ Water Fund 22,662$ 52,150$ 24,287$ 1,848$ 29,419$ Whale Rock Fund 2,210$ 15,963$ 1,356$ 409$ 417$ Information Tech. Replacement Fund Total 304,000$ 1,294,294$ 864,623$ 559,100$ 646,706$ 2017-19 Financial Plan Proposed Airport Area Impact Fee Fleet Replacement Fund General CIP Grant Fund General Purpose CIP Community Development Block Grant (CDBG) Fund CAPITAL IMPROVEMENT PLAN - SUMMARY BY FUND & FUNDING SOURCE Information Technology Replacement Fund Packet Pg 164 13 2017-18 2018-19 2019-20 2020-21 2021-222017-19 Financial Plan Proposed CAPITAL IMPROVEMENT PLAN - SUMMARY BY FUND & FUNDING SOURCE Measure G Revenue 3,288,300$ 3,539,600$ -$ -$ -$ Measure G Revenue - Information Technology 536,500$ 182,023$ -$ -$ -$ Measure G Revenue - Major Facility Replacement 483,900$ 507,700$ -$ -$ -$ Measure G Revenue - Fleet Replacement 638,000$ 508,000$ -$ -$ -$ Measure G Revenue - Fleet Debt 130,000$ 265,000$ -$ -$ -$ Local Revenue Measure Sub-Fund Total 5,076,700$ 5,002,323$ -$ -$ -$ General Capital Outlay 45,000$ 101,000$ 821,900$ 288,000$ 162,200$ Sewer Fund 3,600$ 21,600$ -$ -$ -$ Water Fund 3,600$ 21,600$ -$ -$ -$ Major Facility Replacement Fund Total 52,200$ 144,200$ 821,900$ 288,000$ 162,200$ Debt Financing 17,600,000$ Parking Fund 825,000$ 650,000$ 6,000,000$ 70,000$ -$ Parking Fund Total 825,000$ 650,000$ 23,600,000$ 70,000$ -$ Park In-Lieu Fees 85,000$ 179,000$ -$ -$ -$ Parkland Development Fund Total 85,000$ 179,000$ -$ -$ -$ Art In Lieu Fee 15,000$ 15,000$ 15,000$ 15,000$ 15,000$ General Capital Outlay 109,700$ 111,700$ 50,020$ 50,500$ 52,300$ Public Art Fund Total 124,700$ 126,700$ 65,020$ 65,500$ 67,300$ Sewer Fund 22,042,500$ 58,162,000$ 37,140,000$ 30,906,000$ 4,065,000$ Sewer Fund Total 22,042,500$ 58,162,000$ 37,140,000$ 30,906,000$ 4,065,000$ State or Federal Grant 335,000$ 25,000$ 25,000$ 25,000$ 25,000$ Transit Fund -$ 1,060,000$ 1,590,000$ 1,590,000$ 250,000$ Transit Fund Total 335,000$ 1,085,000$ 1,615,000$ 1,615,000$ 275,000$ Parkland Development Fund Public Art Fund Local Revenue Measure Sub-Fund Major Facility Replacement Fund Parking Fund Sewer Fund Transit Fund Packet Pg 165 13 2017-18 2018-19 2019-20 2020-21 2021-222017-19 Financial Plan Proposed CAPITAL IMPROVEMENT PLAN - SUMMARY BY FUND & FUNDING SOURCE Debt Financing 12,500,000$ Transportation Impact Fee - Fund Balance 60,500$ 1,119,000$ 1,400,000$ 60,000$ -$ Transportation Impact Fee 250,000$ 250,000$ -$ -$ -$ Transportation Impact Fee Total 310,500$ 1,369,000$ 1,400,000$ 60,000$ 12,500,000$ Water Fund 3,277,500$ 9,362,100$ 17,141,000$ 2,784,000$ 2,149,000$ Water Fund Total 3,277,500$ 9,362,100$ 17,141,000$ 2,784,000$ 2,149,000$ Whale Rock Fund 520,000$ 36,000$ -$ -$ 60,000$ Whale Rock Fund Total 520,000$ 36,000$ -$ -$ 60,000$ TOTAL 34,842,100$ 92,560,617$ 88,918,323$ 41,531,600$ 40,868,506$ Transportation Impact Fee Water Fund Whale Rock Fund Packet Pg 166 13 2017-18 2018-19 Community & Neighborhood Livability 170,000$ 425,000$ Community Safety 390,000$ 578,600$ Culture & Recreation 620,000$ 416,700$ Environmental Health & Open Space 20,789,000$ 68,098,000$ Infrastructure & Transportation 12,873,100$ 23,042,317$ TOTAL 34,574,100$ 92,560,617$ CAPITAL IMPROVEMENT PLAN - SUMMARY BY FUNCTION Community & Neighborhood Livability 0% Community Safety 1% Culture & Recreation 1% Environmental Health & Open Space 70% Infrastructure & Transportation 28% 2017-19 CIP by FUNCTION Packet Pg 167 13 PAGE #FUNCTION, CATEGORY, & PROJECT NAME2017-18 2018-19 2019-20 2020-21 2021-22Neighborhood WellnessE2-1Mission Plaza Railing Upgrade-$ 30,000$ -$ 35,000$ 15,000$ E2-3Mission Plaza Restroom Replacements and Enhancements-$ 25,000$ 45,000$ E2-5Park Major Replacement & Repairs 170,000$ 290,000$ 215,000$ 315,000$ 15,000$ E2-11Playground Equipment Replacement-$ 80,000$ 350,000$ 25,000$ 150,000$ COMMUNITY & NEIGHBORHOOD LIVABILITY Total 170,000$ 425,000$ 610,000$ 375,000$ 180,000$ Fire SafetyE2-12Fire Station 4 Emergency Backup Generator7,000$ 72,500$ -$ -$ Police ProtectionE2-14Police Department Space Improvements 35,000$ 89,000$ 279,000$ -$ -$ E2-16Police Station Replacement 15,000$ StormwaterE2-18Silt Removal102,000$ 100,000$ 100,000$ 100,000$ 100,000$ E2-20Storm Drain System Replacement231,000$ 317,100$ 111,780$ 253,500$ 471,300$ COMMUNITY SAFETY Total 390,000$ 578,600$ 490,780$ 353,500$ 571,300$ Cultural ServicesE2-23City/County Library Major Maint. & ADA Compliance405,300$ -$ -$ -$ -$ E2-25Public Art Fund49,700$ 51,700$ 50,020$ 50,500$ 52,300$ E2-27Public Art Master Planning Initiatives75,000$ 75,000$ 15,000$ 15,000$ 15,000$ Recreational ServicesE2-29Parks and Recreation Interior Office Rehabilitation5,000$ 111,000$ -$ -$ E2-31Pickleball Courts (formerly New Park Amenitites60,000$ E2-33Sinsheimer Park Tennis Court Lighting25,000$ 179,000$ CULTURE & RECREATION Total 620,000$ 416,700$ 65,020$ 65,500$ 67,300$ Environmental ProtectionE2-35Green Fleet Vehicle Charging Stations30,000$ 75,000$ E2-37Ongoing Open Space Maintenance60,000$ 60,000$ 60,000$ 60,000$ 60,000$ E2-39Water Resource Recovery Facility Project19,709,000$ 56,500,000$ 35,000,000$ 29,000,000$ E2-41Water Treatment - Energy Efficiency450,000$ 8,500,000$ 5,800,000$ E2-43Water Treatment - Major Facility Maintenance360,000$ 163,000$ 171,000$ 179,000$ 189,000$ E2-45Water Treatment - Tank Maintenance40,000$ 275,000$ 50,000$ OpenSpaceE2-47Laguna Lake Dredging and Sediment Management Project Implementation40,000$ 200,000$ 250,000$ 300,000$ 350,000$ E2-49Open Space Acquisition100,000$ 2,600,000$ 100,000$ 150,000$ 200,000$ ENVIRONMENTAL HEALTH & OPEN SPACE Total 20,789,000$ 68,098,000$ 41,656,000$ 29,739,000$ 799,000$ CAPITAL IMPROVEMENT PLAN - MASTER LIST BY FUNCTIONCOMMUNITY & NEIGHBORHOOD LIVABILITYCOMMUNITY SAFETYCULTURE & RECREATIONENVIRONMENTAL HEALTH & OPEN SPACE2017-19 Financial PlanProposedPacket Pg 16813 PAGE #FUNCTION, CATEGORY, & PROJECT NAME2017-18 2018-19 2019-20 2020-21 2021-22CAPITAL IMPROVEMENT PLAN - MASTER LIST BY FUNCTION2017-19 Financial PlanProposedFacilitiesE2-51City Facility Parking Lot Maintenance 120,000$ -$ 100,000$ 200,000$ E2-53Corporation Yard TI -$ 50,000$ -$ -$ E2-55Major Facility Replacement 536,100$ 651,900$ 821,900$ 288,000$ 162,200$ Information TechnologyE2-62IT Replacement 840,500$ 1,476,317$ 864,623$ 559,100$ 646,706$ E2-165Multimodal Transportation2015 Traffic Safety Report Implementation 60,000$ 175,000$ -$ -$ E2-89Active Transportation Plan 40,000$ -$ -$ -$ -$ E2-91Bicycle Facility Improvements 100,000$ 100,000$ 100,000$ 110,000$ 110,000$ E2-92Bob Jones Trail Prefumo Creek Connection to Oceanaire -$ 1,060,000$ 1,000$ 1,000$ 1,000$ E2-94Broad Street Bicycle Boulevard 18,000$ 180,000$ 270,000$ E2-96Broad Street Corridor Access Improvements 25,000$ 45,000$ -$ -$ E2-98California & Taft Roundabout 60,000$ 1,000,000$ E2-100Higuera St. Widening - Bridge to Elks & Fontana to Chumash 35,500$ 330,000$ E2-79Marsh Street Parking Structure Maintenance 575,000$ -$ -$ -$ -$ E2-104Neighborhood Traffic Improvements 75,000$ 75,000$ 75,000$ 75,000$ 75,000$ E2-102Orcutt & Tank Farm Roundabout 100,000$ E2-81Palm - Nipomo Parking Structure 250,000$ -$ 23,600,000$ -$ -$ E2-83Parking Access Revenue Control System -$ 650,000$ -$ -$ -$ E2-106Pedestrian and Bicycle Pathway Maintenance60,000$ 60,000$ 35,000$ 80,000$ 50,000$ E2-108Penny Lane Bridge at Union Pacific Railroad (UPRR)50,000$ E2-110Prado Road Bridge & Road Widening 595,000$ 9,750,000$ E2-112Prado Road Interchange 150,000$ 840,000$ 2,700,000$ 28,000,000$ E2-114Railroad Safety Trail (RRST) - Pepper Street to the Train Station-$ 30,000$ 140,000$ -$ -$ E2-116Safe Routes to School Implementation Foothill Crossing300,000$ E2-85Transit - Automatic Vehicle Location System310,000$ -$ -$ -$ -$ E2-87Transit - Bus Shelter Replacement25,000$ 25,000$ 25,000$ 25,000$ 25,000$ E2-89Transportation Safety & Operations 30,000$ 90,000$ 30,000$ 90,000$ 30,000$ E2-65Fleet Replacement1,348,000$ 2,287,000$ 2,889,000$ 2,810,000$ 997,000$ Roadway InfrastructureE2-120Bridge Maintenance -$ 50,000$ 100,000$ 75,000$ 75,000$ E2-122Bridge Replacement - Chorro Street -$ -$ -$ 363,000$ E2-124Bridge Replacement - Madonna Road -$ -$ -$ -$ 451,000$ E2-126Bridge Replacement - Nipomo Street390,500$ 160,000$ E2-129Downtown Renewal190,000$ 60,000$ -$ E2-139New Street Lights20,000$ 20,000$ 20,000$ 20,000$ E2-132Sidewalk Replacement and Installation130,000$ 50,000$ 275,000$ 400,000$ 350,000$ E2-135Street Reconstruction & Resurfacing 1,600,000$ 1,600,000$ 1,600,000$ 1,600,000$ 1,600,000$ E2-137Traffic Signs & Striping Maintenance25,000$ 25,000$ 75,000$ 75,000$ INFRASTRUCTURE & TRANSPORTATIONPacket Pg 16913 PAGE #FUNCTION, CATEGORY, & PROJECT NAME2017-18 2018-19 2019-20 2020-21 2021-22CAPITAL IMPROVEMENT PLAN - MASTER LIST BY FUNCTION2017-19 Financial PlanProposedUtility ServicesE2-150LAN Tablet System 34,100$ E2-141Wastewater Collection System Improvements 1,250,000$ 1,474,000$ 1,570,000$ 1,630,000$ 1,870,000$ E2-146Wastewater Collection Telemetry System Improvements 100,000$ 38,000$ -$ -$ -$ E2-148Wastewater Lift Station Replacement 1,085,000$ -$ -$ -$ 1,980,000$ E2-152Water Distribution System Improvements 2,390,000$ 470,000$ 450,000$ 2,610,000$ 2,010,000$ E2-157Water Distribution Telemetry System Improvements 50,000$ 50,000$ -$ -$ -$ E2-159Water Storage Resevoir Replacement 200,000$ 10,500,000$ E2-161Whale Rock Pipeline Reliability Assessment 500,000$ E2-163Whale Rock Resevoir Automoatic Control Valve Replacement 36,000$ INFRASTRUCTURE & TRANSPORTATION Total 12,873,100$ 23,042,317$ 46,096,523$ 10,998,600$ 39,250,906$ TOTAL 34,842,100$ 92,560,617$ 88,918,323$ 41,531,600$ 40,868,506$ Packet Pg 17013 CHANGES IN FINANCIAL POSITION ALL FUNDS COMBINED Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Tax Revenues 56,318,548 56,640,730 58,035,218 2% 59,710,423 3% Fines and Forfeitures 752,176 825,900 734,900 -11% 740,800 1% Investment and Property Revenues 1,932,386 465,400 512,898 10% 516,898 1% Subventions and Grants 14,581,707 20,921,552 5,641,605 -73% 18,858,083 234% Service Charges Governmental Funds 13,659,017 11,423,383 11,573,271 1% 11,493,599 -1% Enterprise Funds 42,991,282 39,794,789 41,030,083 3% 42,131,220 3% Trust and Agency Revenues 1,135,935 1,140,205 1,310,950 15% 1,177,691 -10% Other Revenues 1,031,450 166,100 500,360 201% 550,431 10% Total Revenues 132,402,501 131,378,059 119,339,285 -9% 135,179,146 13% Expenditures Operating Programs Community Safety 25,718,455 26,902,897 29,782,942 11% 30,536,947 3% Public Utilities ---- Infrastructure & Transportation 27,669,793 34,427,550 30,290,423 -12% 30,864,742 2% Community & Neighborhood Livability 8,433,268 10,245,126 9,074,845 -11% 8,815,479 -3% Culture & Recreation 7,505,856 8,627,251 3,613,123 -58% 3,858,583 7% Environmental Health & Open Space -- 8,673,430 8,811,479 2% Fiscal Health & Governance 22,835,600 27,306,548 22,279,840 -18% 22,384,524 0% CalPERS Discount Rate ---432,211 Total Operating Programs 92,162,971 107,509,372 103,714,603 -4% 105,703,965 2% Capital Improvement Plan Projects 26,717,422 72,506,914 34,842,100 -52% 92,560,707 166% Reimbursed Expenditures (4,008,992) (4,164,747) (4,264,633) 2% (4,264,633) Debt Service 7,668,076 7,844,645 7,969,872 2% 8,860,368 11% Total Expenditures 122,539,478 183,696,184 142,261,942 -23% 202,860,407 43% Other Sources (Uses) Adjustment to Working Capial ---- Operating Transfers In 10,123,214 11,999,475 11,739,102 -2% 11,592,133 -1% Operating Transfers Out (9,950,118) (11,998,475) (11,738,759) -2% (11,592,133) -1% Proceeds from Debt Financings 688,500 1,166,600 20,095,000 1623% 65,624,000 227% Projected MOA Adjustments - (15,398) - -100%- GST Loan per Council Approval - (500,000) - -100%- Other Sources (Uses)---- Expenditure Savings - 1,428,944 1,268,462 -11% 1,300,000 2% Total Other Sources (Uses)861,596 2,081,146 21,363,805 927% 66,924,000 213% Revenues and Other Sources Over (Under) Expenditures and Other Uses 10,724,619 (50,236,979) (1,558,852) -97% (757,262) -51% Fund Balance/Working Capital, Beginning of Year 108,867,259 119,556,437 68,830,458 -42% 67,271,607 -2% Non-Dispensible Restricted (489,000) -100% Fund Balance/Working Capital, End of Year Prior Year Restatement (709,020) --- Adjustment for Long Term Accruals (35,441) --- Reserved for Debt Service 2,119,724 2,119,724 2,119,723 0% 2,119,721 0% Unreserved 48,130,091 66,710,735 65,151,884 -2% 64,394,625 -1% Total Fund Balance/Working Capital 119,556,437 68,830,458 67,271,607 -2% 66,514,345 -1% 2017-19 Financial Plan % Change % Change Attachment C to Exhibit 1 Packet Pg 171 13 CHANGES IN FINANCIAL POSITION ALL GOVERNMENTAL FUNDS COMBINED Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Tax Revenues 56,318,548 56,640,730 58,035,218 2% 59,710,423 3% Fines and Forfeitures 172,353 156,000 147,600 -5% 147,600 Investment and Property Revenues 630,908 308,600 356,098 15% 356,098 Subventions and Grants 11,692,887 16,750,282 2,719,968 -84% 15,052,325 453% Service Charges 13,659,017 11,423,383 11,573,271 1% 11,493,599 -1% Other Revenues 272,299 72,500 170,660 135% 210,660 23% Total Revenues 82,746,011 85,351,495 73,002,815 -14% 86,970,706 19% Expenditures Operating Programs1 Community Safety 25,718,455 26,902,897 29,782,942 11% 30,536,947 3% Infrastructure & Transportation 3,146,156 4,050,322 11,281,049 179% 11,443,756 1% Culture & Recreation 7,505,856 8,619,751 3,605,623 -58% 3,851,083 7% Community & Neighborhood Livability 8,433,268 10,245,126 8,558,952 -16% 8,283,932 -3% Environmental Health & Open Space - - 1,023,313 1,044,495 2% Fiscal Health & Governance 16,698,171 22,138,801 14,976,666 -32% 14,968,836 0% CalPERS Discount Rate - - - 375,000 Total Operating Programs 61,501,905 71,956,897 69,228,545 -4% 70,504,049 2% Reimbursed Expenditures (4,008,992) (4,164,747) (4,264,633) 2% (4,264,633) Total Operating Expenditures 57,492,913 67,792,150 64,963,912 -4% 66,239,416 2% Capital Improvement Plan Projects 19,102,153 40,473,435 7,842,100 -81% 23,265,607 197% Debt Service 3,101,381 3,245,866 3,374,758 4% 3,506,210 4% Total Expenditures 79,696,448 111,511,451 76,180,770 -32% 93,011,233 22% Other Sources (Uses) Operating Transfers In 7,826,118 10,259,577 10,989,102 7% 11,092,133 1% Operating Transfers Out (8,514,070) (10,946,912) (9,732,193) -11% (9,362,660) -4% Proceeds from Debt Financings 688,500 1,166,600 595,000 -49% 624,000 5% Projected MOA Adjustments - - - Expenditure Savings - 1,428,944 1,268,462 -11% 1,300,000 2% Total Other Sources (Uses)548 1,908,209 3,120,371 64% 3,653,473 17% Revenues and Other Sources Over (Under) Expenditures and Other Uses 3,050,111 (24,251,747) (57,584) -100% (2,387,054) 4045% Fund Balance, Beginning of Year 47,908,724 50,249,815 25,509,068 -49% 25,451,485 0% Prior Year Restatement (709,020) - - - Non-Dispensable Restricted - (489,000) - -100%- 47,199,704 49,760,815 25,509,068 -49% 25,451,485 0% Fund Balance, End of Year Reserved for Debt Service 2,119,724 2,119,724 2,119,723 0% 2,119,721 0% Unreserved 48,130,091 23,389,344 23,331,762 0% 20,944,709 -10% Total Fund Balance 50,249,815 25,509,068 25,451,485 0% 23,064,430 -9% 1 Prior to 2017-18, Operating and Capital expenditures were categorized into different City Functions. 2017-19 Financial Plan % Change % Change Packet Pg 172 13 CHANGES IN FINANCIAL POSITION ALL ENTERPRISE AND AGENCY FUNDS COMBINED Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Fines and Forfeitures 579,823 669,900 587,300 -12% 593,200 1% Investment and Property Revenues 1,301,478 156,800 156,800 160,800 3% From Other Governments 2,888,820 4,171,270 2,921,637 -30% 3,805,758 30% Service Charges 42,991,282 39,794,789 41,030,083 3% 42,131,220 3% Other Revenues 759,151 93,600 329,700 252% 339,771 3% Trust and Agency Revenues 1,135,935 1,140,205 1,310,950 15% 1,177,691 -10% Total Revenues 49,656,490 46,026,564 46,336,470 1% 48,208,440 4% Expenditures Operating Programs1 Community Safety - - - - Community & Neighborhood Livability - - 515,893 531,547 3% Environmental Health & Open Space - - 7,650,117 7,766,984 2% Infrastructure & Transportation 24,523,637 30,377,228 19,009,374 -37% 19,420,986 2% Culture & Recreation - 7,500 7,500 7,500 CalPERS Discount Rate - - - 57,211 Fiscal Health & Governance 6,137,429 5,167,747 7,303,174 41% 7,415,688 2% Total Operating Programs 30,661,066 35,552,475 34,486,058 -3% 35,199,916 2% Capital Improvement Plan Projects 7,615,269 32,033,479 27,000,000 -16% 69,295,100 157% Debt Service 4,566,695 4,598,779 4,595,114 0% 5,354,158 17% Total Expenditures 42,843,030 72,184,733 66,081,172 -8% 109,849,174 66% Other Sources (Uses) Adjustment to Working Capial - - - - Operating Transfers In 2,297,096 1,739,898 750,000 -57% 500,000 -33% Proceeds from Debt Financings - - 19,500,000 65,000,000 233% Operating Transfers Out (1,436,048) (1,051,563) (2,006,566) 91% (2,229,473) 11% GST Loan per Council Approval - (500,000) - -100% - Projected MOA Adjustments - (15,398) - -100% - Other Sources (Uses) - - - - Total Other Sources (Uses) 861,048 172,937 18,243,434 10449%63,270,527 247% Revenues and Other Sources Over (Under) Expenditures and Other Uses 7,674,508 (25,985,232) (1,501,268) -94% 1,629,793 -209% Working Capital, Beginning of Year 61,667,555 69,306,622 43,321,390 -37% 41,820,122 Adjustment for Long Term Accruals (35,441) Working Capital, End of Year 69,306,622 43,321,390 41,820,122 -3% 43,449,915 4% 1 Prior to 2017-18, Operating and Capital expenditures were categorized into different City Functions. 2017-19 Financial Plan % Change % Change Packet Pg 173 13 CHANGES IN FINANCIAL POSITION GENERAL FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Tax Revenues 49,140,388 49,249,730 50,428,218 2% 52,031,423 3% Fines and Forfeitures 172,353 156,000 147,600 -5% 147,600 Investment and Property Revenues 380,946 281,700 264,798 -6% 264,798 Subventions and Grants 1,459,775 316,000 316,000 316,000 Service Charges 9,623,282 8,769,518 9,596,384 9% 9,484,425 -1% Other Revenues 86,259 55,000 130,660 138% 130,660 Total Revenues 60,863,003 58,827,948 60,883,660 3% 62,374,906 2% Expenditures Operating Programs 1 Community Safety 24,870,762 25,985,759 27,996,083 8% 28,679,650 2% Infrastructure & Transportation 2,291,830 2,734,553 10,766,356 294% 10,912,749 1% Culture & Recreation 7,311,138 8,137,529 3,605,623 -56% 3,851,083 7% Community & Neighborhood Livability 7,834,301 9,826,194 8,283,022 -16% 8,000,386 -3% Environmental Health & Open Space - - 878,628 892,427 2% Fiscal Health & Governance 15,080,806 20,425,177 13,409,321 -34% 13,396,029 0% CalPERS Discount Rate - - - 375,000 Total Program Expenditures 57,388,837 67,109,212 64,939,032 -3% 66,107,324 2% Reimbursed Expenditures (4,008,992) (4,164,747) (4,264,633) 2% (4,264,633) Total Expenditures 53,379,845 62,944,465 60,674,399 -4% 61,842,691 2% Other Sources (Uses) Operating Transfers In 2,920,748 2,353,342 3,398,300 44% 3,259,635 -4% Proceeds from Debt Issuance - - - - Operating Transfers Out (6,975,470) (9,605,233) (4,707,714) -51% (5,148,535) 9% Expenditure Savings 1,428,944 1,268,462 -11% 1,300,000 2% Other Sources - - - - Total Other Sources (Uses) (4,054,722) (5,822,947) (40,952) -99% (588,900) 1338% Revenues and Other Sources Over (Under) Expenditures and Other Uses 3,428,437 (9,939,464) 168,309 -102% (56,685) -134% Transfer to Local Revenue Measure Fund Fund Balance, Beginning of Year 22,140,527 24,859,944 14,431,480 -42% 14,599,789 1% Prior Year Restatement (709,020) - - - Non-Dispensible Restricted - (489,000) Fund Balance, End of Year sub-total 24,859,944 14,431,480 14,599,789 1% 14,543,104 0% Fund Balance Components: Designated Reserves (4,112,465) Policy Reserve Level @ 20%:(11,475,178) (10,851,000) (10,708,080) -1% (10,777,000) 1% Amount Over (Under) Policy Reserve: 9,272,301 3,580,480 3,891,709 9% 3,766,104 -3% 1 Prior to 2017-18, Operating and Capital expenditures were categorized into different City Functions. 2017-19 Financial Plan % Change % Change Packet Pg 174 13 CHANGES IN FINANCIAL POSITION LOCAL REVENUE MEASURE SUB-FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Tax Revenues 7,178,160 7,391,000 7,607,000 3% 7,679,000 1% Investment & Property Revenue 9,043 - - - Total Revenues 7,187,203 7,391,000 7,607,000 3%7,679,000 1% Expenditures Operating Programs Community Safety 705,843 812,655 1,786,859 120% 1,857,297 4% Infrastructure & Transportation 854,326 1,315,769 514,693 -61% 531,007 3% Culture & Recreation 194,718 208,187 - -100% - Community & Neighborhood Livability 328,737 5,000 83,520 1570% 84,563 1% Environmental Health & Open Space 144,685 152,068 5% Fiscal Health & Governance - - - - Capital Improvement Plan Projects 2,797,460 10,030,836 4,946,700 -51% 4,737,323 -4% Total Expenditures 4,881,084 12,372,447 7,476,458 -40%7,362,258 -2% Other Sources (Uses) Operating Transfers In - - 1,658,400 1,197,723 Operating Transfers Out - - (1,788,400) (1,462,723) -18% Total Other Sources (Uses)- - (130,000) (265,000) 104% Revenues and Other Sources Over (Under) Expenditures and Other Uses 2,306,119 (4,981,447) 542 -100% 51,742 9442% Fund Balance, Beginning of Year 2,426,279 4,732,398 (249,049) -105% (248,507) 0% Fund Balance, End of Year sub-total* 4,732,398 (249,049) (248,507) 0%(196,765) -21% Fund Balance Components: Reserved (3,962,736) Unreserved 769,662 *20% Reserve fund balance is fully reported/calculated within General Fund Changes in Financial Position. Expenditures may be adjusted at each year-end to maintain the sub-fund balance above negative and the difference will be absorbed by the General Fund. % Change % Change 2017-19 Financial Plan Packet Pg 175 13 CHANGES IN FINANCIAL POSITION INSURANCE BENEFIT Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 987 - - - Service Charges - - - Total Revenues 987 - - - Expenditures Operating Programs Fiscal Health & Governance 2,128,437 1,000,000 1,000,000 1,000,000 Capital Improvement Plan Projects - - - - Total Expenditures 2,128,437 1,000,000 1,000,000 1,000,000 Other Sources (Uses) Operating Transfer In 2,124,000 1,739,898 750,000 -57% 500,000 -33% Operating Transfer Out - - - Total Other Sources (Uses) 2,124,000 1,739,898 750,000 -57%500,000 -33% Revenues and Other Sources Over (Under) Expenditures and Other Uses (3,450) 739,898 (250,000) -134% (500,000) 100% Fund Balance, Beginning of Year 343,301 339,851 1,079,749 218% 829,749 -23% Fund Balance, End of Year 339,851 1,079,749 829,749 -23%329,749 -60% % Change % Change 2017-19 Financial Plan Packet Pg 176 13 CHANGES IN FINANCIAL POSITION DOWNTOWN BUSINESS IMPROVEMENT DISTRICT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues Service Charges Assessments 222,111 214,000 227,000 6% 227,000 Other Service Charges - - - Total Service Charges 222,111 214,000 227,000 6% 227,000 Other Revenues Total Revenues 222,111 214,000 227,000 6% 227,000 Expenditures Operating Programs Fiscal Health & Governance 222,111 214,000 227,000 6% 227,000 Capital Improvement Plan Projects - - - - Total Expenditures 222,111 214,000 227,000 6% 227,000 Other Sources (Uses) Operating Transfer In Operating Transfer Out - - Total Other Sources (Uses) - - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses - - - - Fund Balance, Beginning of Year 1,122 1,122 1,122 1,122 Prior Year Restatement Fund Balance, End of Year 1,122 1,122 1,122 1,122 % Change % Change 2017-19 Financial Plan Packet Pg 177 13 CHANGES IN FINANCIAL POSITION TOURISM BUSINESS IMPROVEMENT DISTRICT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 1,723 1,100 1,400 27% 1,400 Service Charges 1,429,190 1,433,975 1,464,387 2% 1,493,675 2% Total Revenues 1,430,913 1,435,075 1,465,787 2% 1,495,075 2% Expenditures Operating Programs Fiscal Health & Governance 1,395,253 1,499,624 1,340,345 -11% 1,345,807 0% Capital Improvement Plan Projects - - - - Total Expenditures 1,395,253 1,499,624 1,340,345 -11% 1,345,807 0% Other Sources (Uses) Operating Transfer In - - - - Operating Transfer Out (28,412) (28,679) (27,679) -3% (28,679) 4% Total Other Sources (Uses) (28,412) (28,679) (27,679) -3% (28,679) 4% Revenues and Other Sources Over (Under) Expenditures and Other Uses 7,247 (93,228) 97,763 -205% 120,589 23% Fund Balance, Beginning of Year 333,028 340,275 247,047 -27% 344,810 40% Prior Year Restatement Fund Balance, End of Year 340,275 247,047 344,810 40% 465,399 35% % Change % Change 2017-19 Financial Plan Packet Pg 178 13 CHANGES IN FINANCIAL POSITION COMMUNITY DEVELOPMENT BLOCK GRANT (CDBG) FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues From Other Governments CDBG Allocation*304,004 597,863 232,623 -61%- -1 Other Revenues - - - - Total Revenues 304,004 597,863 232,623 -61%- -100% Expenditures Operating Programs Community & Neighborhood Livability 270,230 413,932 192,410 -54% 198,983 3% Fiscal Health & Governance - - - - Total Operating Programs 270,230 413,932 192,410 -54% 198,983 3% Capital Improvement Plan Projects 164,853 337,899 105,000 -69% - -100% Debt Service Total Expenditures 435,083 751,831 297,410 -60% 198,983 -33% Other Sources (Uses) Operating Transfer In 147,487 153,969 154,000 0% 154,000 Total Other Sources (uses) 147,487 153,969 154,000 0% 154,000 Revenues and Other Sources Over (Under) Expenditures and Other Uses 16,408 1 89,213 8921200% (44,983) -150% Fund Balance, Beginning of Year (83) 16,325 16,326 0% 105,539 546% Fund Balance, End of Year 16,325 16,326 105,539 546%60,556 -43% *The City will have more information whether fund are available in 2018-19 by the end of fiscal year 2017-18. No revenues are expected in 2018-19 at this time. % Change 2017-19 Financial Plan % Change Packet Pg 179 13 CHANGES IN FINANCIAL POSITION GAS TAX FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues From Other Governments - Gasoline Tax 1,033,757 965,000 965,000 965,000 Total Revenues 1,033,757 965,000 965,000 965,000 Other Sources (Uses) Operating Transfers Out (1,033,757) (965,000) (965,000) (965,000) Total Other Sources (Uses) (1,033,757) (965,000) (965,000) (965,000) Revenues and Other Sources Over (Under) Expenditures and Other Uses - - - - Fund Balance, Beginning of Year - - - - Fund Balance, End of Year - - - - In March 2010,the Legislature passed ABx8 6 and ABx8 9, which contained the provisions for a swap of Proposition 42 state sales tax on gasoline with allocations from the motor vehicle excise tax (gas tax). % Change % Change 2017-19 Financial Plan Packet Pg 180 13 CHANGES IN FINANCIAL POSITION TRANSPORTATION DEVELOPMENT ACT (TDA) FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Subventions and Grants 40,531 41,100 45,000 9% 45,000 Total Revenues 40,531 41,100 45,000 9% 45,000 Other Sources (Uses) Operating Transfers Out (40,531) (41,100) (45,000) 9% (45,000) Total Other Sources (Uses) (40,531) (41,100) (45,000) 9% (45,000) Revenues and Other Sources Over (Under) Expenditures and Other Uses - - - - Fund Balance, Beginning of Year - - - - Fund Balance, End of Year - - - - % Change % Change 2017-19 Financial Plan Packet Pg 181 13 CHANGES IN FINANCIAL POSITION LAW ENFORCEMENT GRANTS FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 12 - - - Subventions and Grants 206,831 105,708 81,345 -23% 21,325 -74% Service Charges 1,782 69,000 - -100% - Total Revenues 208,625 174,708 81,345 -53%21,325 -74% Expenditures Operating Programs Community Safety 141,850 104,483 - -100% - Capital Improvement Plan Projects 60,169 69,607 - -100% - Total Expenditures 202,019 174,090 - -100%- Other Sources (Uses) Operating Transfer In - - - - Operating Transfer Out - - - - Total Other Sources (Uses) - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses 6,606 618 81,345 13063% 21,325 -74% Fund Balance, Beginning of Year 16,886 23,492 24,110 3% 105,455 337% Fund Balance, End of Year 23,492 24,110 105,455 337% 126,780 20% % Change 2017-19 Financial Plan % Change Packet Pg 182 13 CHANGES IN FINANCIAL POSITION PUBLIC ART (PRIVATE SECTOR CONTRIBUTIONS) FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 2,892 2,100 2,100 2,100 Service Charges In-lieu fees - 40,000 35,500 -11% 38,500 8% Other Revenues 79,994 - - - Total Revenues 82,886 42,100 37,600 -11% 40,600 8% Expenditures Operating Programs Cultural & Recreation 274,035 -100% Capital Improvement Plan Projects 58,321 40,061 124,700 211% 126,700 2% Total Expenditures 58,321 314,096 124,700 -60%126,700 2% Other Sources (Uses) Operating Transfer In 36,400 39,900 - -100% - Operating Transfer Out Total Other Sources (Uses) 36,400 39,900 - -100%- Revenues and Other Sources Over (Under) Expenditures and Other Uses 60,965 (232,096) (87,100) -62% (86,100) -1% Fund Balance, Beginning of Year 362,844 423,809 191,713 -55% 104,613 -45% Fund Balance, End of Year 423,809 191,713 104,613 -45% 18,513 -82% % Change 2017-19 Financial Plan % Change Packet Pg 183 13 CHANGES IN FINANCIAL POSITION GENERAL PURPOSE CIP Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Subventions and Grants 8,574,127 12,124,611 1,020,000 -92% 13,705,000 1244% Service Charges - - - - Other Revenues 2,506 - - - Total Revenues 8,576,633 12,124,611 1,020,000 -92%13,705,000 1244% Expenditures Capital Improvement Plan Projects 9,972,831 15,499,077 1,234,000 -92% 13,966,000 1032% Total Expenditures 9,972,831 15,499,077 1,234,000 -92% 13,966,000 1032% Other Sources (Uses) Operating Transfers In 281,733 439,900 263,700 -40% 257,400 -2% Operating Transfers Out (53,900) (39,900) -100% Other Sources (Uses) - - Sale of Surplus Property - - Total Other Sources (Uses) 227,833 400,000 263,700 -34% 257,400 -2% Revenues and Other Sources Over (Under) Expenditures and Other Uses (1,168,365) (2,974,466) 49,700 -102% (3,600) -107% Fund Balance, Beginning of Year 4,352,266 3,183,901 209,435 -93% 259,135 24% Prior Year Restatement Fund Balance, End of Year 3,183,901 209,435 259,135 24% 255,535 -1% % Change% Change 2017-19 Financial Plan Packet Pg 184 13 CHANGES IN FINANCIAL POSITION PARKLAND DEVELOPMENT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 5,756 3,000 3,900 30% 3,900 Subventions and Grants - - - Service Charges Park In-Lieu Fees 174,799 - - - Dwelling Unit Fees 7,950 - - - Other Revenues 34,320 - - - Total Revenues 222,825 3,000 3,900 30% 3,900 Expenditures Capital Improvement Plan Projects 1,572 252,697 85,000 -66% 179,000 111% Total Expenditures 1,572 252,697 85,000 -66%179,000 111% Other Sources (Uses) Operating Transfers In - 900,000 - -100% Operating Transfers Out - - (160,000) -100% Total Other Sources (Uses)- 900,000 (160,000) -118% - -100% Revenues and Other Sources Over (Under) Expenditures and Other Uses 221,253 650,303 (241,100) -137% (175,100) -0.27374533 Fund Balance, Beginning of Year 620,558 841,811 1,492,114 77% 1,251,014 -16% Fund Balance, End of Year 841,811 1,492,114 1,251,014 -16% 1,075,914 -14% % Change % Change 2017-19 Financial Plan Packet Pg 185 13 CHANGES IN FINANCIAL POSITION TRANSPORTATION IMPACT FEE FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 107,807 1,000 46,000 4500% 46,000 Subventions and Grants - - Impact Fees 1,356,158 889,990 250,000 -72% 250,000 Other Revenues - - Total Revenues 1,463,965 890,990 296,000 -67% 296,000 Expenditures Capital Improvement Plan Projects 3,803,935 3,734,040 310,500 -92% 1,369,000 341% Total Expenditures 3,803,935 3,734,040 310,500 -92% 1,369,000 341% Other Sources (Uses) Proceeds from Debt Financing - - Operating Transfer In - - Operating Transfer Out (320,000) (250,000) (250,000) (250,000) Total Other Sources (Uses) (320,000) (250,000) (250,000) (250,000) Revenues and Other Sources Over (Under) Expenditures and Other Uses (2,659,970) (3,093,050) (264,500) -91% (1,323,000) 400% Fund Balance, Beginning of Year 8,879,649 6,219,679 3,126,629 -50% 2,862,129 -8% Prior Year Restatement Fund Balance, End of Year 6,219,679 3,126,629 2,862,129 -8% 1,539,129 -46% % Change % Change 2017-19 Financial Plan Packet Pg 186 13 CHANGES IN FINANCIAL POSITION FLEET REPLACEMENT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 13,625 6,000 10,000 67% 10,000 Service Charges - Other Revenues - Sale of Surplus Property 69,220 10,000 40,000 300% 80,000 100% Green Vehicle Rebates 7,500 -100% Total Revenues 82,845 23,500 50,000 113%90,000 80% Expenditures Capital Improvement Plan Projects 686,387 2,154,331 625,000 -71% 699,000 12% Total Expenditures 686,387 2,154,331 625,000 -71% 699,000 12% Other Sources (Uses) Proceeds from Debt Financing - 1,166,600 595,000 -49% 624,000 5% Operating Transfers Out - - (768,000) (773,000) 1% Operating Transfers In 384,100 - 768,000 773,000 1% Total Other Sources (Uses) 384,100 1,166,600 595,000 -49% 624,000 5% Revenues and Other Sources Over (Under) Expenditures and Other Uses (219,442) (964,231) 20,000 -102% 15,000 -25% Fund Balance, Beginning of Year 2,029,047 1,809,605 845,374 -53% 865,374 2% Fund Balance, End of Year 1,809,605 845,374 865,374 2% 880,374 2% % Change % Change 2017-19 Financial Plan Packet Pg 187 13 CHANGES IN FINANCIAL POSITION OPEN SPACE PROTECTION FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 4,101 - - - Subventions and Grants 2,600,000 -100% Service Charges 47,369 6,900 -100% Other Revenues - - - Total Revenues 51,470 2,606,900 - -100% - Expenditures Capital Improvement Plan Projects 32,743 2,970,881 -100% Total Expenditures 32,743 2,970,881 - -100% - Other Sources (Uses) Operating Transfer In - - - Operating Transfer Out - - - Total Other Sources (Uses) - - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses 18,726 (363,981) - -100% - - Fund Balance, Beginning of Year 530,623 549,349 185,368 -66% 185,368 - Fund Balance, End of Year 549,349 185,368 185,368 185,368 % Change 2017-19 Financial Plan % Change Packet Pg 188 13 CHANGES IN FINANCIAL POSITION AIRPORT AREA IMPACT FEE FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 8,248 1,000 5,000 400% 5,000 Service Charges 134,210 - - - Total Revenues 142,458 1,000 5,000 400% 5,000 Expenditures Capital Improvement Plan Projects - 56,669 55,000 -3% 750,000 1264% Total Expenditures - 56,669 55,000 -3%750,000 1264% Other Sources (Uses) Operating Transfer Out - - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses 142,458 (55,669) (50,000) -10% (745,000) 1390% Fund Balance, Beginning of Year 937,498 1,079,956 1,024,287 -5% 974,287 -5% Fund Balance, End of Year 1,079,956 1,024,287 974,287 -5% 229,287 -76% % Change % Change 2017-19 Financial Plan Packet Pg 189 13 CHANGES IN FINANCIAL POSITION AFFORDABLE HOUSING FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 34,415 8,000 14,000 75% 14,000 Subventions and Grants - - - Service Charges 625,506 - - - Total Revenues 659,921 8,000 14,000 75%14,000 Expenditures Capital Improvement Plan Projects 636,978 1,524,227 - -100% - Total Expenditures 636,978 1,524,227 - -100%- Transfer Out (62,000) (17,000) - -100%- Revenues and Other Sources Over (Under) Expenditures and Other Uses (39,057) (1,533,227) 14,000 -101% 14,000 Fund Balance, Beginning of Year 2,601,882 2,562,825 1,029,598 -60% 1,043,598 1% Fund Balance, End of Year 2,562,825 1,029,598 1,043,598 1% 1,057,598 1% 2017-19 Financial Plan % Change % Change Packet Pg 190 13 CHANGES IN FINANCIAL POSITION LOS OSOS VALLEY ROAD SUB-AREA FEE FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 2,586 1,700 1,700 1,700 Service Charges 14,661 - - Total Revenues 17,246 1,700 1,700 1,700 Expenditures Capital Improvement Plan Projects - - - Total Expenditures - - - - Other Sources (Uses) Operating Transfer In - - - - Operating Transfer Out - - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses 17,246 1,700 1,700 1,700 Fund Balance, Beginning of Year 146,723 163,969 165,669 1% 167,369 1% Fund Balance, End of Year 163,969 165,669 167,369 1% 169,069 1% 2017-19 Financial Plan % Change% Change Packet Pg 191 13 CHANGES IN FINANCIAL POSITION INFORMATION TECHNOLOGY REPLACEMENT Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 2,765 1,500 5,000 233% 5,000 Subventions and Grants 73,861 - 60,000 - -100% Service Charges Total Revenues 76,626 1,500 65,000 4233%5,000 -92% Expenditures Capital Improvement Plan Projects 481,374 2,803,400 304,000 -89% 1,294,294 326% Total Expenditures 481,374 2,803,400 304,000 -89% 1,294,294 326% Other Sources (Uses) Operating Transfer In 617,000 2,621,000 689,745 -74% 1,350,967 96% Operating Transfer Out (536,500) (182,023) -66% Debt Proceeds 688,500 - - - Total Sources (Uses) 1,305,500 2,621,000 153,245 -94% 1,168,944 663% Revenues and Other Sources Over (Under) Expenditures and Other Uses 900,753 (180,900) (85,755) -53% (120,350) 40% Fund Balance, Beginning of Year (159,846) 740,907 560,007 -24% 474,252 -15% Fund Balance, End of Year 740,907 560,007 474,252 -15% 353,902 -25% % Change 2017-19 Financial Plan % Change Packet Pg 192 13 CHANGES IN FINANCIAL POSITION MAJOR FACILITY REPLACEMENT Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 606 500 1,300 160% 1,300 Service Charges Donation 22,000 - - - Total Revenues 22,606 500 1,300 160%1,300 Expenditures Capital Improvement Plan Projects 405,530 749,710 52,200 -93% 144,290 176% Total Expenditures 405,530 749,710 52,200 -93% 144,290 176% Other Sources (Uses) Operating Transfer In 163,250 504,600 682,200 35% 593,200 -13% Operating Transfer Out - - (483,900) (507,700) 5% 163,250 504,600 198,300 -61% 85,500 -57% Revenues and Other Sources Over (Under) Expenditures and Other Uses (219,674) (244,610) 147,400 -160% (57,490) -139% Fund Balance, Beginning of Year 488,636 268,962 24,352 -91% 171,752 605% Fund Balance, End of Year 268,962 24,352 171,752 605% 114,262 -33% % Change 2017-19 Financial Plan % Change Packet Pg 193 13 CHANGES IN FINANCIAL POSITION INFRASTRUCTURE INVESTMENT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 1,660 1,000 900 -10% 900 Service Charges - - - Total Revenues 1,660 1,000 900 -10%900 Expenditures Operating Programs Capital Improvement Projects - 250,000 - -100% - Total Expenditures - 250,000 - -100% - Other Sources (Uses) Operating Transfer In 250,000 1,000 - -100% - Debt Proceeds - Total Sources (Uses) 250,000 1,000 - -100% - Revenues and Other Sources Over (Under) Expenditures and Other Uses 251,660 (248,000) 900 -100%900 Fund Balance, Beginning of Year 60,105 311,765 63,765 -80% 64,665 1% Fund Balance, End of Year 311,765 63,765 64,665 1% 65,565 1% % Change% Change 2017-19 Financial Plan Packet Pg 194 13 CHANGES IN FINANCIAL POSITION DEBT SERVICE FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment Property Revenue 54,725 Total Revenues 54,725 Expenditures Debt Service Cost of debt issuance - - 2012/2001 Refunded Revenue Bonds 388,725 385,350 385,075 0% 387,875 1% 2004/1994 Refunding Revenue Bonds - - - - 2005/1996 Refunding Revenue Bonds 467,851 466,789 469,589 1% 466,789 -1% 2006 Lease Revenue Bonds 460,374 459,914 458,940 0% 459,832 0% 2009 Lease Revenue Bonds 829,998 826,610 826,779 0% 820,501 -1% Fire Engine/Truck Lease Purchase 127,492 129,203 125,764 -3% 127,326 1% Capital Lease / Fire Truck 2014 116,702 116,702 116,702 116,702 Capital Lease (I.T. Equipment)195,190 199,049 199,235 0% 199,236 0% 2014 Lease Revenue Bond/ LOVR 515,050 422,181 422,606 0% 422,881 0% Insurance Retrospective Charges - PERS Side Fund Payment - Fleet Debt Service 240,068 370,068 54% 505,068 36% Total Expenditures 3,101,381 3,245,866 3,374,758 4% 3,506,210 4% .. Other Sources (Uses) Operating Transfers In 3,025,400 3,245,866 3,374,757 4% 3,506,208 4% Operating Transfers Out - - - Proceeds from Debt Financing - - - Total Other Sources (Uses) 3,025,400 3,245,866 3,374,757 4% 3,506,208 4% Revenues and Other Sources Over (Under) Expenditures and Other Uses (21,256) - (1) (2) 100% Fund Balance, Beginning of Year 2,140,980 2,119,724 2,119,724 2,119,723 0% Fund Balance, End of Year Reserved for Debt Service 2,119,724 2,119,724 2,119,723 0% 2,119,721 0% Total Fund Balance 2,119,724 2,119,724 2,119,723 0% 2,119,721 0% % Change% Change 2017-19 Financial Plan Packet Pg 195 13 CHANGES IN FINANCIAL POSITION WATER FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Service Charges Water Sales Water Service Charges 17,084,904 17,216,708 17,623,312 2% 18,167,251 3% Sales to Other Agencies 862,813 850,000 866,250 2% 892,238 3% Development Impact Fees 1,542,268 800,000 800,000 800,000 Connection Charges and Meter Sales 60,421 71,000 61,000 -14% 61,000 Late Charges and Credit Card Fees 39,584 65,000 23,000 -65% 23,000 Account Set-up Fee 107,159 100,000 156,000 56% 156,000 AB 939 Reimbursement 141,957 135,000 145,000 7% 147,900 2% Total Service Charges 19,839,106 19,237,708 19,674,562 2% 20,247,389 3% Other Revenues 46,439 50,000 283,000 466% 283,000 Subventions and Grants - - - - Investment and Property Revenues 544,808 50,000 50,000 50,000 Total Revenues 20,430,353 19,337,708 20,007,562 3% 20,580,389 3% Expenditures Operating Programs - - 515,893 531,547 - - 2,791,977 2,761,401 Infrastructure & Transportation 12,909,891 16,438,538 11,217,372 -32% 11,415,616 2% Fiscal Health & Governance 1,328,061 1,477,598 2,191,201 48% 2,230,068 2% CalPERS Discount Rate - - - 24,414 Total Operating Programs 14,237,952 17,916,136 16,716,443 -7% 16,963,046 1% Capital Improvement Plan Projects 2,366,716 7,514,756 3,277,500 -56%9,362,100 186% Debt Service 2,169,951 2,193,792 2,194,005 0% 2,955,652 35% Total Expenditures 18,774,619 27,624,684 22,187,948 -20% 29,280,798 32% Other Sources (Uses) Other Sources (Uses) Proceeds from Debt Financing - - 8,500,000 Projected MOA Adjustments - - - Operating Transfer In - - - Operating Transfers Out (469,607) (561,244) (967,599) 72% (1,027,176) 6% Expenditure Savings - - - Other Sources (Uses)- - - Total Other Sources (Uses)(469,607) (561,244) (967,599) 72% 7,472,824 -872% Revenues and Other Sources Over (Under) Expenditures and Other Uses 1,186,127 (8,848,220) (3,147,985) -64% (1,227,585) -61% Working Capital, Beginning of Year 21,876,499 22,929,660 14,081,440 -39% 10,933,455 -22% Adjustment for Long Term Accruals (132,966) - - - Working Capital, End of Year 22,929,660 14,081,440 10,933,455 -22% 9,705,869 -11% Environmental Health & Open Space Community & Neighborhood Livability % Change% Change 2017-19 Financial Plan Packet Pg 196 13 CHANGES IN FINANCIAL POSITION SEWER FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Service Charges Customer Sales Sewer Service Charges 14,526,664 14,300,000 14,301,464 0% 14,741,100 3% Sales to Cal Poly 888,437 875,000 875,000 901,250 3% Development Impact Fees 502,393 300,000 300,000 300,000 Account Set-Up Fees 107,131 100,000 156,000 56% 156,000 Late Charges and credit card fees 40,066 65,000 23,000 -65% 23,000 Industrial User Charges 79,822 70,000 85,000 21% 85,000 Connection Charges and Meter Sales 60,241 71,000 61,000 -14% 61,000 Total Service Charges 16,204,754 15,781,000 15,801,464 0% 16,267,350 3% Other Revenues 50,718 37,500 34,000 -9% 44,071 30% Investment and Property Revenues 388,540 50,000 50,000 50,000 Total Revenues 16,644,012 15,868,500 15,885,464 0% 16,361,421 3% Expenditures Operating Programs - - - - - - 4,858,140 4,973,738 Infrastructure & Transportation 6,018,807 7,098,843 1,126,926 -84% 1,142,593 1% Fiscal Health & Governance 1,576,026 1,591,041 3,027,860 90% 3,101,507 2% CalPERS Discount Rate - - - 24,713 Total Operating Programs 7,594,833 8,689,884 9,012,926 4% 9,242,551 3% Capital Improvement Plan Projects 5,178,481 19,677,576 22,042,500 12% 58,162,000 164% Debt Service 1,437,543 1,435,587 1,433,709 0% 1,431,006 0% Total Expenditures 14,210,857 29,803,047 32,489,135 9% 68,835,557 112% Other Sources (Uses) Cashflow adjustment for working capital - - - Proceeds from Debt Financing - - 19,500,000 56,500,000 190% Projected MOA Adjustments - - - - Operating Transfer In 173,096 - - - Operating Transfers Out (493,073) (490,319) (817,715) 67% (901,818) 10% Other Sources (Uses)- - - Total Other Sources (Uses)(319,977) (490,319) 18,682,285 -3910%55,598,182 198% Revenues and Other Sources Over (Under) Expenditures and Other Uses 2,113,177 (14,424,866) 2,078,614 -114% 3,124,046 50% Working Capital, Beginning of Year 27,071,809 29,096,197 14,671,331 -50% 16,749,946 14% Adjustment for Long Term Accruals (88,789) - - - Working Capital, End of Year 29,096,197 14,671,331 16,749,946 14% 19,873,992 19% Community & Neighborhood Livability Environmental Health & Open Space % Change% Change 2017-19 Financial Plan Packet Pg 197 13 CHANGES IN FINANCIAL POSITION WHALE ROCK COMMISSION Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 19,273 1,000 1,000 1,000 Service Charges Member Agency Contributions O & M 724,058 735,828 808,845 10% 845,179 4% Member Agency Contributions CIP 411,877 404,377 502,105 24% 332,512 -34% Water Distribution Charges 277,791 370,000 337,500 -9% 351,000 4% Other Service Charges - - - Total Service Charges & Interest 1,432,999 1,511,205 1,649,450 9% 1,529,691 -7% Other Revenues 5,508 1,500 6,000 300% 6,000 Total Revenues 1,438,507 1,512,705 1,655,450 9%1,535,691 -7% Expenditures Operating Programs Infrastructure & Transportation 838,529 1,006,373 1,026,637 2% 1,070,745 4% Fiscal Health & Governance 115,989 125,510 141,937 13% 141,937 Total Operating Programs 954,518 1,131,883 1,168,574 3% 1,212,682 4% Capital Improvement Plan Projects 49,525 606,419 520,000 -14% 36,000 -93% Total Expenditures 1,004,043 1,738,302 1,688,574 -3% 1,248,682 -26% Other Sources (Uses) Operating Transfers Out - - (2,210) (15,963) 622% Other Sources (Uses) - - - - Adjust for working capital - - - - Total Other Sources (Uses) - - (2,210) (15,963) 622% Revenues and Other Sources Over (Under) Expenditures and Other Uses 434,464 (225,597) (35,334) -84% 271,046 -867% Working Capital, Beginning of Year 1,122,068 1,556,532 1,330,935 -14% 1,295,601 -3% Working Capital, End of Year 1,556,532 1,330,935 1,295,601 -3% 1,566,647 21% % Change 2017-19 Financial Plan % Change Packet Pg 198 13 CHANGES IN FINANCIAL POSITION PARKING FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Service Charges Parking Meter Collections Lots 304,345 166,200 140,400 -16% 141,900 1% Streets 1,526,182 1,539,100 1,648,100 7% 1,664,700 1% Parking Structure Collections 1,162,982 1,054,700 1,489,500 41% 1,504,400 1% Long-Term Parking Revenues 642,483 434,900 795,000 83% 802,900 1% Lease Revenues 403,630 500,500 502,900 0% 509,800 1% Parking In-Lieu Fees 2,641,296 20,200 20,400 1% 20,600 1% Other Service Charges (15,096) 100 (89,100) -89200% (90,000) 1% Total Service Charges 6,665,822 3,715,700 4,507,200 21% 4,554,300 1% Investment and Property Revenues 333,687 48,200 48,000 0% 52,000 8% Fines and Forfeitures 579,823 669,900 587,300 -12% 593,200 1% Other Revenues 827 - 100 100 Total Revenues 7,580,159 4,433,800 5,142,600 16% 5,199,600 1% Expenditures Operating Programs Infrastructure & Transportation 1,835,753 2,385,106 2,215,088 -7% 2,274,025 3% Fiscal Health & Governance 711,587 684,603 622,189 -9% 622,189 CalPERS Discount Rate - - - 6,200 Total Operating Programs 2,547,340 3,069,709 2,837,277 -8% 2,902,414 2% Capital Improvement Plan Projects 20,547 2,231,404 825,000 -63% 650,000 -21% Debt Service 959,201 969,400 967,400 0% 967,500 0% Total Expenditures 3,527,088 6,270,513 4,629,677 -26% 4,519,914 -2% Other Sources (Uses) Cashflow adjustment for working capital - - - Expenditure Savings - - - Operating Transfer In - - - - Operating Transfer Out (473,368) - (157,644) (169,865) 8% PERS 1% Contribution - - - - Proceeds from Debt Financing - - - - Other Sources (Uses)- - - - GST Loan per Council Approval - (500,000) - -100% - Potential MOA Adjustments - (11,198) - -100% - Total Other Sources (Uses) (473,368) (511,198) (157,644) -69%(169,865) 8% Revenues and Other Sources Over (Under) Expenditures and Other Uses 3,579,703 (2,347,911) 355,279 -115% 509,821 43% Working Capital, Beginning of Year 8,391,033 12,305,964 9,958,053 -19% 10,313,332 4% Adjustment for Long Term Accruals 335,228 - - - Working Capital, End of Year 12,305,964 9,958,053 10,313,332 4% 10,823,153 5% % Change 2017-19 Financial Plan % Change Packet Pg 199 13 CHANGES IN FINANCIAL POSITION TRANSIT FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenues 11,202 5,800 5,800 5,800 From Other Governments TDA Revenues (LTF)1,312,716 1,286,625 1,166,759 -9% 1,166,759 TDA Revenues (STA)162,418 159,890 154,027 -4% 152,748 -1% Other Grants 39,738 1,300,200 174,600 -87% 1,060,000 507% FTA Grants 1,373,948 1,424,555 1,426,251 0% 1,426,251 Service Charges 3,809 690,381 709,357 3% 711,181 0% Other Revenues 655,660 4,600 6,600 43% 6,600 Total Revenues 3,559,492 4,872,051 3,643,394 -25% 4,529,339 24% Expenditures Operating Programs Infrastructure & Transportation 2,920,657 3,448,368 3,423,351 -1% 3,518,007 3% Fiscal Health & Governance 277,329 288,995 319,987 11% 319,987 CalPERS Discount Rate - - - 1,884 Total Operating Programs 3,197,986 3,737,363 3,743,338 0% 3,839,878 3% Capital Improvement Plan Projects - 2,003,324 335,000 -83% 1,085,000 224% Total Expenditures 3,197,986 5,740,687 4,078,338 -29% 4,924,878 21% Other Sources (Uses) Cashflow adjustment for working capital - - - - Projected MOA Adjustments - (4,200) -100% Operating Transfer In - - - - Operating Transfer Out - - (61,398) (114,651) 87% Other Sources - - Expenditure Savings - - - - Total Other Sources (Uses)- (4,200) (61,398) 1362% (114,651) 87% Revenues and Other Sources Over (Under) Expenditures and Other Uses 361,506 (872,836) (496,342) -43%(510,190) 3% Working Capital, Beginning of Year 2,775,920 2,988,512 2,115,676 -29% 1,619,334 -23% Adjustment for Long Term Accruals (148,914) Prior Year Restatement Working Capital, End of Year 2,988,512 2,115,676 1,619,334 -23% 1,109,144 -32% % Change 2017-19 Financial Plan % Change Packet Pg 200 13 CHANGES IN FINANCIAL POSITION BOYSEN RANCH CONSERVATION FUND Actual Mid-Year Proposed Proposed 2015-16 2016-17 2017-18 2018-19 Revenues Investment and Property Revenue 2,981 1,800 2,000 11% 2,000 Service Charges - - - Total Revenues 2,981 1,800 2,000 11%2,000 Expenditures Culture & Recreation 7,500 7,500 7,500 Total Expenditures - 7,500 7,500 7,500 Other Sources (Uses) Operating Transfer In - Debt Proceeds - Total Sources (Uses) - - - - Revenues and Other Sources Over (Under) Expenditures and Other Uses 2,981 (5,700) (5,500) -4% (5,500) Fund Balance, Beginning of Year 86,925 89,906 84,206 -6% 78,706 -7% Fund Balance, End of Year 89,906 84,206 78,706 -7% 73,206 -7% % Change 2017-19 Financial Plan % Change Packet Pg 201 13 Page intentionally left blank. Packet Pg 202 13 Meeting Date: 6/20/2017 FROM: Michael Codron, Community Development Director Prepared By: Steven Orozco, Planning Technician SUBJECT: TAX AND EQUITY FISCAL RESPONSIBILITY ACT (TEFRA) HEARING REGARDING THE HOUSING AUTHORITY OF SAN LUIS OBISPO ISSUANCE OF A TAX-EXEMPT DEBT OBLIGATION TO FINANCE THE REHABILITATION BOND OF 55 AFFORDABLE HOUSING UNITS AT 1092 ORCUTT ROAD, 1102 IRONBARK, AND 1363 PISMO STREET RECOMMENDATION 1. Conduct a public hearing under the Tax and Equity Fiscal Responsibility Act (TEFRA) of 1982 pursuant to the requirements of the Internal Revenue Code of 1986; and 2. Adopt a resolution (Attachment A) allowing the issuance of a tax -exempt loan by the Housing Authority of the City of San Luis Obispo to acquire and rehabilitate Laurel Creek Apartments, Ironbark Apartments, and Pismo Buchon Apartments. DISCUSSION Previous Council Approval & New TEFRA Request On May 2, 2017, the City Council held a public hearing regarding the proposed issuance by the Housing Authority of San Luis Obispo (HASLO) of $5,600,000 of bonds to finance costs of the acquisition and rehabilitation of the Housing Facilities and, following the public hearing, approved the issuance of those bonds by the Authority (Attachment B). However, the costs of the rehabilitation of the Housing Facilities have unexpectedly increased, and HASLO now proposes to issue the Bonds to provide additional financing for such costs. The Housing Authority of the City of San Luis Obispo (HASLO) is requesting that the Council hold a public hearing regarding the issuance of a second tax-exempt loan in the amount of $900,000 to acquire and rehabilitate the 55 units of affordable housing. Although there is no financial participation (or liability, direct or indirect) by the City in approving the issuance of this “conduit” financing, Council conduct of a public hearing and approval of the reissuance is required under federal regulations for tax-exempt financing. Background HASLO was the original developer for Laurel Creek Apartments, Ironbark Apartments, and Pismo Buchon Apartments. The primary funding source for each of these projects was the low- income housing tax credits awarded by the California Tax Credit Allocation Committee (TCAC). California statue does not allow Housing Authorities to be a party in these partnerships, so the Housing Authority transferred its interest to San Luis Obispo Non-profit Housing Corporation (SLONP). SLONP serves as the sole Managing General Partner. The partnerships have a 15-year compliance period over which the tax credits are earned. After 15 years, the limited partner has the option to seek a buyer for its interest. Packet Pg 203 14 Laurel Creek Apartments, Ironbark Apartments, and Pismo Buchon Apartments have all passed the 15-year compliance period, and the limited partner, WNC & Associates, wishes to dissolve the partnership and sell its interest in the properties. All the properties have capital improvement needs of approximately $1,820,000 that must be addressed in the near future. HASLO closed escrow earlier in June 2017 to purchase the partnership interests in Laurel Creek Apartments, Ironbark Apartments, and Pismo Buchon Apartments; and will now work with SLONP to form a new partnership. Project Summary 1. HASLO successfully obtained Low Income Housing Tax Credits in the Summer of 2016 to move forward with the project. 2. Laurel Creek Apartments is a 24-unit affordable rental apartment complex located at 1092 Orcutt Road. Laurel Creek Apartments was placed into service in June 1994 as is in need for approximately $1,200,000 in capital improvements. 3. Ironbark Apartments, located at 1102 Ironbark, has 20 affordable rental units and was placed into service in November 1995. Approximately $20,000 per unit in capital improvements is needed for the site, for a total of $400,000. 4. Pismo Buchon Apartments are located at 1363 Pismo Street. The affordable housing complex has 11 rental units and was placed into service in 2000. Approximately $220,000 is needed in capital improvements for this complex. 4. The issuance of the Bond requires that the Council conduct a public hearing regarding the financing of the Project under the Tax Equity and Fiscal Responsibility Act of 1982 (“TEFRA”), and pursuant to the requirements of the Internal Revenue Code of 1986. The TEFRA public hearing allows Council to adopt a resolution approving the issuance by the Authority of the Bonds, in order to maintain purchase and rehabilitate the three affordable housing facilities. No City Liability for the Financing There is no City liability in approving the issuance of conduit financing. The bonds are payable solely from the payments by the Borrower on a loan made to it (the “Borrower Loan”) by the Authority from the proceeds of the Bonds. The rental payments by tenants in the Project are the source of revenue used by the Borrower to repay the Borrower Loan. The City has no financial, legal, or other obligation, liability or responsibility for the Project or for the repayment of the Bonds or the repayment of the Borrower Loan. The documents for the Bonds clearly provide that the Bonds are payable solely from payments on the Borrower Loan made by the Borrower. Outside of holding this hearing and adopting the required resolution, no other participation or activity of the City with respect to the bonds will be required. City’s Conduit Financing Policy While the Council is not obligated to approve this request, it would be consistent with past City actions regarding the Project. Under the City’s debt financing and management policies, consideration of a request for conduit financing is generally a two-step process: Packet Pg 204 14 1. First asking the Council if they are interested in considering the request and establishing the ground rules for evaluating it. 2. And then returning with the results of this evaluation and recommending approval of appropriate financing documents if warranted. Given the Council’s prior approval for this TEFRA hearing in May 2017, and past successful approval to conduit financing to HASLO, staff recommends that the Council find HASLO capable for achieving the public purpose of maintaining and providing affordable housing financed partially through tax exempt bonds. City’s Past Experience with Conduit Housing Bonds The City has approved thirteen “conduit” housing bond issues in the past as reflected in the following summary. There have been no financial difficulties with any of these bond issues. 1. 1985. 168-unit apartment development on Southwood Drive (refinanced in 1993). 2. 1998. 30-unit development (all affordable for seniors and persons with disabilities) on Brizzolara Street. 3. 1999. 122-unit apartment development by the De Vaul Ranch Company, of which 26 units will be affordable: 24 for “very-low” and 2 for “moderate” income households. 4. 2002. 19-unit senior apartment development at 433 Pacific Street (Pacific and Carmel). 5. 2005. 40 affordable one-bedroom units for seniors as well as one manager’s unit in an existing historic single-family residence at 2005 Johnson Avenue (“Del Rio Terrace”). 6. 2009 and 2011. 8-unit housing project at 1468 East Foothill Boulevard for the University Board of the Santa Barbara Presbytery. 7. 2012. 120-unit apartment project affordable to low and very-low income households located at 1550 Madonna Road. 8. 2013. 19-unit apartment project affordable rental apartment facility for seniors located at 433 Pacific (“Carmel Street Apartments”). 9. 2013. 40-unit affordable rental apartment facility for seniors located at 2005 Johnson Avenue (“Del Rio Terrace”). 10. 2016. Rehabilitation of 55 affordable rental units located at 1092 Orcutt Road, 1102 Ironbark, and 1363 Pismo Street. 11. 2016. 46-unit affordable apartment development at 3680 Broad Street (“Iron Works”). Packet Pg 205 14 12. 2017. Renewal of the rehabilitation of 55 affordable rental units located at 1092 Orcutt Road, 1102 Ironbark, and 1363 Pismo Street. 13. 2017. Renewal of a 46-unit affordable apartment development at 3680 Broad Street (“Iron Works”). Next Steps After the TEFRA public hearing and adoption of the Resolution of the Council approving the issuance of Bonds, HASLO will begin rehabilitation work on the units. There will be no further actions required by the City. ENVIRONMENTAL REVIEW The project is exempt from environmental review per Section 15061(b)(3) of the California Environmental Quality Act Guidelines because action is in regards to financing a future affordable housing project which will be subject to environmental review. The activity in question will not have a significant impact on the environment. FISCAL IMPACT There are no fiscal impacts to the City associated with this matter. As noted above, the City has no liability, directly or indirectly, for the financing. ALTERNATIVES 1. Do not approve the issuance of bonds by the Authority. Given that the Council had approved a TEFRA hearing in May 2017, and that HASLO has closed escrow, t his hearing is crucial in making sure this project moves forward, this option is not recommended. 2. Defer consideration of the request. Due to the critical need for tax exempt bond financing to rehabilitate these units, this option is not recommended. Attachments: a - Draft Resolution b - Resolution No. 10794 (2017 Series) Packet Pg 206 14 R ______ RESOLUTION NO. ______ (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING THE INCURRING OF A TAX- EXEMPT OBLIGATION BY THE HOUSING AUTHORITY OF THE CITY OF SAN LUIS OBISPO FOR THE PURPOSE OF PROVIDING ADDITIONAL FINANCING FOR THE REHABILITATION OF LAUREL CREEK, IRONBARK AND PISMO BUCHON APARTMENTS WHEREAS, the Housing Authority of the City of San Luis Obispo (the “Authority”) is authorized by Chapter 1 of Part 2 of Division 24 of the Health and Safety Code of the State of California, as amended (the “Act”), to incur indebtedness and to make loans for housing purposes specified in the Act; and WHEREAS, SLO 55, L.P., a California limited partnership (the “Borrower”) intends to acquire and rehabilitate the following three apartment facilities (collectively referred to in this Resolution as the “Housing Facilities”): Laurel Creek Apartments, located at 1092 Orcutt Road in the City, Ironbark Apartments located at 1102 Ironbark Street in the City, and Pismo Buchon Apartments, located at 1363 Pismo Street in the City; and WHEREAS, such assistance will involve the issuance by the Authority of debt obligations (which may be in the form of a loan evidenced by a note or tax-exempt revenue bonds, and referred to in this Resolution as the “Bonds”) and a loan of the proceeds of the Bonds to the Borrower; and WHEREAS, a portion of the housing units in the Housing Facilities will be rented to persons and families of low or very low income as required by the Act and the Internal Revenue Code of 1986, as amended (the “Code”); and WHEREAS, the Bonds will be considered to be a “qualified exempt facility bonds” under Section 142(a) of the Code, and Section 147(f) of the Code requires that the “applicable elected representative” with respect to the Authority approve the issuance by the Authority of the Bonds following the holding of a public hearing with respect thereto; and WHEREAS, the Authority has determined that the Council of the City is the “applicable elected representative” to approve the issuance by the Authority of the Bonds because the Housing Facilities are all located within the City; and WHEREAS, following the conduct by the Council of a public hearing on May 2, 2017, regarding the issuance of the Bonds by the Authority, the City Council adopted a resolution approving the issuance by the Authority of $5,600,000 of Bonds for the Housing Facilities; and WHEREAS, the costs of the rehabilitation of the Housing Facilities has unexpectedly increased, and the Authority has now requested that the Council hold a public hearing regarding the issuance of an additional $900,000 in Bonds by the Authority to finance costs of the Housing Packet Pg 207 14 Resolution No. ______ (2017 Series) Page 2 R ______ Facilities (the “Additional Bonds”), and approve the issuance of the Additional Bonds by the Authority; and WHEREAS, notice of a public hearing by the Council regarding the issuance of the Additional Bonds by the Authority to provide financing for the Housing Facilities has been duly given as required by the Code, and the Council has held the public hearing at which all interested persons were given an opportunity to be heard on all matters relative to the location, operation and financing of the Housing Facilities, including the Authority's issuance of the Additional Bonds and subsequent lending of the proceeds thereof to the Borrower to pay costs of the rehabilitation by the Borrower of the Housing Facilities; and WHEREAS, the City will not be a party to any of the agreements or other documents related to the Bonds or the Additional Bonds, or the use of the proceeds thereof for the financing of the Housing Facilities, the City will have no liability or responsibility relat ed to the repayment or administration of the Bonds or the Additional Bonds, and the issuance of the Bonds, the issuance of the Additional Bonds and the financing of the Housing Facilities with the proceeds thereof will not impose any legal, financial or moral obligation on the City; and WHEREAS, it is in the public interest, for the public benefit and in furtherance of the public purpose of the City that the Council approve the issuance by the Authority of the Additional Bonds for the aforesaid purposes. NOW, THEREFORE, BE IT RESOLVED that the Council of the City of San Luis Obispo does declare, determine and order as follows: SECTION 1. Approval of Issuance of Bonds. The Council of the City of San Luis Obispo hereby approves the issuance by the Authority of the Additional Bonds for purposes of the Code. SECTION 2. Environmental Determination. The Council of the City of San Luis Obispo has determined that the above action will not have a significant impact on the environment, as defined by §15061(b)(3) of the California Environmental Quality Act and is exempt from environmental review. SECTION 3. This resolution shall take effect immediately upon its adoption. Packet Pg 208 14 Resolution No. ______ (2017 Series) Page 3 R ______ Upon motion of Council Member _______________ seconded by Council Member _______________ and on the following roll call vote: AYES: NOES: ABSENT: The foregoing Resolution was adopted this 20th day of June, 2017. Mayor Heidi Harmon ATTEST: Carrie Gallagher City Clerk APPROVED AS TO FORM: J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 209 14 RESOLUTION NO. 10794 (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, APPROVING THE INCURRING OF A TAX EXEMPT OBLIGATION BY THE HOUSING AUTHORITY OF THE CITY OF SAN LUIS OBISPO FOR THE PURPOSE OF PROVIDING FINANCING FOR THE ACQUISITION AND REHABILITATION OF LAUREL CREEK, IRONBARK AND PISMO BUCHON APARTMENTS WHEREAS, the Housing Authority of the City of San Luis Obispo (the "Authority") is authorized by Chapter 1 of Part 2 of Division 24 of the Health and Safety Code of the State of California, as amended (the "Act"), to incur indebtedness and to make loans for housing purposes specified in the Act; and WHEREAS, SLO 55, L.P., a California limited partnership (the `Borrower") intends to acquire and rehabilitate the following three apartment facilities (collectively referred to in this Resolution as the "Housing Facilities"): Laurel Creek Apartments, located at 1092 Orcutt Road in the City, Ironbark Apartments located at 1102 Ironbark Street in the City, and Pismo Buchon Apartments, located at 1363 Pismo Street in the City; and WHEREAS, such assistance will involve the issuance by the Authority of debt obligations which may be in the form of a loan evidenced by a note or tax-exempt revenue bonds, and referred to in this Resolution as the "Bonds") in the approximate amount of $5,600,000, and a loan of the proceeds of the Bonds to the Borrower; and WHEREAS, a portion of the housing units in the Housing Facilities will be rented to persons and families of low or very low income as required by the Act and the Internal Revenue Code of 1986, as amended (the "Code"); and WHEREAS, the Bonds will be considered to be a "qualified exempt facility bonds" under Section 142(a) of the Code, and Section 147(f) of the Code requires that the "applicable elected representative" with respect to the Authority approve the issuance by the Authority of the Bonds following the holding of a public hearing with respect thereto; and WHEREAS, the Authority has determined that the Council of the City is the "applicable elected representative" to approve the issuance by the Authority of the Bonds because the Housing Facilities are all located within the City; and WHEREAS, notice of a public hearing by the Council regarding the financing of the Housing Facilities has been duly given as required by the Code, and the Council has held the public hearing at which all interested persons were given an opportunity to be heard on all matters relative to the location, operation and financing of the Housing Facilities, including the Authority's issuance of the Bonds and subsequent lending of the proceeds thereof to the Borrower to pay costs of the acquisition and rehabilitation by the Borrower of the Housing Facilities; and R 10794 Packet Pg 210 14 Resolution No. 10794 (2017 Series) Page 2 WHEREAS, the City will not be a party to any of the agreements or other documents related to the Bonds and the financing of the Housing Facilities, the City will have no liability or responsibility related to the repayment or administration of the Bonds, and the issuance of the Bonds and the financing of the Housing Facilities will not impose any legal, financial or moral obligation on the City; and WHEREAS, it is in the public interest, for the public benefit and in furtherance of the public purpose of the City that the Council approve the issuance by the Authority of the Bonds for the aforesaid purposes. NOW, THEREFORE, BE IT RESOLVED that the Council of the City of San Luis Obispo does declare, determine and order as follows: SECTION 1. Approval -of Issuance of Bonds. The Council of the City of San Luis Obispo hereby approves the issuance by the Authority of the Bonds for purposes of the Code. SECTION 2. Environmental Determination. The Council of the City of San Luis Obispo has determined that the above action will not have a significant impact on the environment, as defined by §15061(b)(3) of the California Environmental Quality Act and is exempt from environmental review. Upon motion of Council Member Christianson, seconded by Council Member Gomez, and on the following roll call vote: AYES: Council Members Christianson, Gomez, and Pease Vice Mayor Rivoire and Mayor Harmon NOES: None ABSENT: None The foregoing resolution was adopted this 2nd day of May 2017. Ma or H di Harmo ATTEST: Aaj,4- 11(, Z IJO Carrie Gallagher City Clerk R 10794 Packet Pg 211 14 Resolution No. 10794 (2017 Series) APPROVED AS TO FORM: Page 3 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this l Zik day of , 2017. Carrie Gallagher City Clerk R 10794 Packet Pg 212 14 Meeting Date: 6/20/2017 FROM: Carrie Mattingly, Utilities Director Prepared By: Aaron Floyd, Utilities Deputy Director - Water Mychal Boerman, Water Resources Program Manager Jennifer Metz, Utilities Projects Manager SUBJECT: RESCINDING THE LOCAL DROUGHT EMERGENCY AND ASSOCIATED RESOLUTIONS RECOMMENDATIONS Adopt a Resolution (Attachment F): 1. Rescinding Resolution Nos. 10566, 10627, 10628, and 10635, (Attachments A-E) ending the local drought emergency declaration and associated water use restrictions; and 2. Rescinding Resolution No. 10629 which authorized and established a permit fee and regulations for the use of the Corporation Yard non-potable well and direct staff to make necessary changes to eliminate public access to the well. DISCUSSION State and Local Emergency Drought Declaration In response to the State’s emergency drought declaration and restrictions on water use, on September 16, 2014 the City Council adopted a resolution (Attachment A) limiting outdoor irrigation of ornamental landscape or turf with potable water to three days a week. On June 2, 2015, the City Council adopted a series of additional resolutions (Attachment B) including: 1. Declaration of a local drought emergency (Resolution No. 10627) 2. Deferral of new landscape installation or the use of modified landscape plans during the drought emergency (Resolution No. 10628) 3. Establishment of a permit fee for the use of the Corporation Yard non -potable groundwater well (Resolution No. 10629) On June 16, 2015, the City Council adopted Resolution No. 10635 limiting outdoor irrigation of ornamental landscaping or turf with potable water to two days a week (Attachment C). Rescinding Drought Declaration Following the abundant rainfall received this winter, on April 7, 2017 Governor Brown issued Executive Order B-40-17 ending the state of emergency in California and eliminating the City’s 12 percent water use reduction requirement. The City’s emergency drought declaration and restrictions on water use have remained in effect since their adoption in 2015. To eliminate these restrictions, it is recommended the City Council adopt a resolution to rescind 1) the resolution to declare the drought emergency and 2) the Packet Pg 213 15 resolutions adopted to support the drought emergency and imposing various watering restrictions. Current City Water Supply The watersheds that feed the City’s three reservoirs were very productive this winter. The majority of increases in water storage at local reservoirs occurred from January through March of 2017 with levels sustaining through May (see Figure 1). The increased reservoir levels further strengthened the resiliency of the City’s water supply and resulted in the addition of several years of stored water in Salinas and Whale Rock reservoirs. Nacimiento Reservoir, from which the City receives 5,482 acre-feet annually through contract, saw the largest volume of water added. Both Nacimiento and Salinas Reservoir experienced far more inflow than they were able to retain. Corporation Yard Well The Corporation Yard well was established during the drought of 1987-1991 to serve as an alternative source of water for construction related activities (prior to the City’s recycled water program). Over the years, word spread about the well and it began to see more use. It became known that people outside of the City were using the well for non-potable uses such as laundry, livestock, and toilet flushing which was of concern. Lines for water at the well grew to the point where trucks backed up all the way to the freeway off-ramp while waiting to fill up. Something had to be done to regulate the use of the well. In June 2015, when the City Council declared a local drought emergency, guidelines were established and a permit fee was identified for the use of the Corporation Yard well. Using this water instead of potable water was one way in which citizens could continue to water their trees and plants while helping to achieve mandated water reductions. The actions taken Table 1: Corporation Yard Well Usage 2015-16 through 2016-17 Well Usage (in acre feet) # Permits Inside City Outside City Total July 2015- June 30, 2016 8.57 23 17 40 July 2016-May 4, 2017 5.46 27 17 44 NOTES: The Corporation Yard Well permit program began in July 2015. Packet Pg 214 15 also eliminated the lines waiting to fill up at the well. All construction activities were required to use recycled water. The establishment of the permit program for use of the well was intended to provide temporary support to those affected by watering restrictions or depleted groundwater levels. There were parcels within the San Luis Obispo Valley Groundwater Basin (SLOVGB) that were out of water, which had been using the well water, and had little to no other water options. City Council limited the use of the well water to those parcels located within the SLOVGB thereby allowing those parcels to use the well water under this program for specific purposes during the severe drought. The Corporation Yard Well was not intended to be used as a permanent water source for users inside or outside of the City. The June 2015 Council Agenda Report on the drought noted that upon rescission of the drought emergency, the well would be shut down and would no longer be available for public use. The permit application form emphasizes that “Public use of the well will be discontinued when the drought emergency is rescinded by the City Council.” Complicating factors with the well permit program requiring staff action included lost well access keys, lack of permit identification, and people loaning their well access key to others. Prior to recent rains, staff was also concerned whether permit holders were using the non-potable well water consistent with listed allowed uses. Signage was posted at the Corporation Yard well location in May 2017 and a direct mailing was sent to each permit holder that, as informed when signing up for a permit, the permit would expire June 30, 2017 or when the drought emergency was rescinded; whichever came sooner. The notifications also listed the location, date, and time of the City Council meeting on June 20. State ‘Conservation as a way of Life’ Future On May 9, 2016 Governor Brown signed Executive Order B-37-16 (see Figure 2 for framework to achieve the intent of the Executive Order). This order aims to establish long-term water conservation measures and improved planning for more frequent and severe droughts. The centerpiece of the Executive Order is a requirement for the State’s urban water suppliers to meet new water conservation targets, thus replacing the State’s current mandate to reduce water use in California 20 percent by 2020. In addition to new conservation targets, requirements include: Water Use Prohibitions: The Water Board will establish permanent prohibitions on wasteful water use, building and expanding on currently prohibited uses. Minimizing Water Loss: Starting in October 2017 the City will be required to submit validated water loss audit reports to the Board. Beginning in 2020, water retailers will be required to meet water loss performance standards. The City has completed three stages of a four-stage water audit process as required by Executive Order B-37-16 and will submit a validated water loss audit to the State in October 2017. Drought Risk Assessments: Every five years, the City is required to update its Urban Water Management Plan. In its next update, the City will now be required to include a Drought Risk Assessment; an analysis of the resiliency of the city’s water supplies for five years into the future. Packet Pg 215 15 Staff will return to Council with recommendations to adopt permanent prohibitions on wasteful water use and revisions to the Water Shortage Contingency Plan in compliance with Executive Order B-37-16 once those requirements have been finalized at the State level. Continued City Efforts Despite relief from the drought, water conservation remains a way of life. The City will continue its support of school education programs, public information campaigns, home water audits, water consumption database audits, and other long term elements of the City’s successful water conservation program. Current municipal code requirements, such as prohibiting wasteful water use and the toilet retrofit-upon-sale program remain in place. The City’s Water Efficient Landscape Ordinance, which requires that newly installed landscapes make efficient use of water, remains in effect. CONCURRENCES The Community Development Department concurs with the recommendations made in this report. ENVIRONMENTAL REVIEW The rescission of resolutions related to the Drought Emergency is not a "project" under the California Environmental Quality Act (CEQA), because the action does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378. Figure 2: CA State Framework Packet Pg 216 15 FISCAL IMPACT Rescinding water use restrictions put in place to support the drought emergency could result in increased water sales and associated revenue if water use increased. ALTERNATIVES 1. Deferral of new landscape planting or use of modified landscape plans. The Council could elect not to rescind Resolution No. 10628 and continue the deferral of new landscape planting or the use of modified landscape plans. The City’s Water Efficient Landscape Ordinance remains in effect requiring newly installed landscapes to make efficient use of water. 2. Corporation Yard Well. The Council could keep the permit program in place allowing well use under the current regulations and fee or modify the current regulations and fee. This alternative is not recommended as current access to the well was intended to provide relief during the declared local drought emergency and not provide a permanent water supply. It was not intended to be used as a revenue source for the water utility. 3. Watering day restrictions. The Council could decide to maintain watering day restrictions. This alternative is not recommended as it is not aligned with the City’s adopted Water Shortage Contingency Plan that enacts these conservation measures when there is less than a projected five-year supply of water remaining. Maintaining restrictions when it isn’t necessary (and when staffing has been eliminated to ensure compliance with these restrictions) could reduce buy-in when the need is genuinely there. Attachments: a - Resolution 10566 (2014 Series) b - Resolution 10627 (2015 Series) c - Resolution 10628 (2015 Series) d - Resolution 10635 (2015 Series) e - Resolution 10629 (2015 Series) f- Resolution rescinding drought Packet Pg 217 15 RESOLUTION NO. 10566 ( 2014 Series) A RESOLUTION OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, IMPLENIENTING MANDATORY RESTRICTIONS ON THE OUTDOOR IRRIGATION OF ORNANIENTAL LANDSCAPES OR TURF WITH POTABLE WATER WHEREAS, on July 15, 2014 the State Water Resources Control Board adopted California Code of Regulations ("CCR"), title 23, sections 863, 864 and 865 (the "Emergency Regulations"), which require, among other things, that urban water suppliers implement all requirements and actions of the stage of its water shortage contingency plan that imposes mandatory restrictions on outdoor irrigation of ornamental landscapes or turf with potable water; and WHEREAS, the City of San Luis Obispo ("City') is an urban water supplier subject to the Emergency Regulations; and WHEREAS, on September 2, 2014 the San Luis Obispo City Council adopted an ordinance amending Chapter 13.07 of the City's Municipal Code in order to comply with the Emergency Regulations; and WHEREAS. by this Resolution, the City intends on implementing all requirements and actions within its Water Shortage Contingency Plan restricting the use of potable water for the outdoor irrigation of ornamental landscapes or turf. NOW, THEREFORE, 13E IT RESOLVED, by the City Council of the City of San Luis Obispo as follows: SECTION 1. The City Council hereby implements Section 13.07.030(6) of the Municipal Code and hereby limits the outdoor irrigation of ornamental landscape or turf with potable water to three days a week in accordance with the following schedule: Even numbered addresses - Sunday, Tuesday and Thursday Odd numbered addresses - Monday, Wednesday and Friday SECTION 2. Effective Date and Term. The effective date of this Resolution is October 2. 2014. This Resolution shall remain in effect until and shall automatically expire on April 25, 2015 unless the State Water Board extends or rescinds the Emergency Regulations in which case this Resolution shall be so extended or shall so terminate so that the restrictions on outdoor irrigation set forth in Section 1 above run concurrently with the life of the Emergency Regulations. R 10566 Packet Pg 218 15 Resolution No. 10566 (2014 Series) Page 2 Upon motion of Council Member Ashbaugh, seconded by Vice Mayor Christianson, and on the following roll call vote: AYES: Council Members Ashbaugh and Smith. Vice Mayor Christianson and Mayor Marx NOES: Council Member Carpenter ABSENT: None The foregoing resolution was adopted this 16`h day of September 2014. Mayor lei Marx rte i5riv . M ia, MM City.Gle k,. APPROVED AS T FORM: C istme Dietrick City Attorney Packet Pg 219 15 RESOLUTION NO. 10627 (2015 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, DECLARING A LOCAL DROUGHT EMERGENCY WHEREAS, on January 17, 2014, Governor Edmund G. Brown issued the governor's Proclamation No. 1 -17 -2014 declaring a State of Emergency to exist in California due to severe drought conditions; and WHEREAS, on April 26, 2014, the Governor issued an executive order to strengthen the state's ability to manage water and habitat effectively in drought conditions and called on all Californians to redouble their efforts to conserve water; and WHEREAS, Water Code section 1058.5 grants the State Water Resources Control Board the authority to adopt emergency regulations in certain drought years in order to: "prevent the waste, unreasonable use, unreasonable method of use, or unreasonable method of diversion, of water, to promote water recycling or water conservation, to require curtailment of diversions when water is not available under the diverter's priority of right, or in furtherance of any of the foregoing, to require reporting of diversion or use or the preparation of monitoring reports "; and WHEREAS, on July 15, 2014, the State Water Resources Control Board adopted California Code of Regulations, title 23, sections 863, 864 and 865 (the "Emergency Regulations "), which requires, among other things, that urban water suppliers implement all requirements and actions of the stage of its water shortage contingency plan that imposes mandatory restrictions on outdoor irrigation of ornamental landscapes or turf with potable water; and WHEREAS, on March 17, 2015, the State Water Resources Control Board expanded and extended the Emergency Regulations in response to continued drought conditions; and WHEREAS, on April 1, 2015, the Governor issued an Executive Order B -29 -15 which requires increased enforcement against water waste and mandates a 25% reduction in water use statewide; and WHEREAS, on May 5, 2015, in response to Executive Order B- 29 -15, the State Water Resources Control Board adopted regulations adding additional prohibitions on the use of potable water and mandating that the City reduce its water use by twelve percent (12 %) as compared to 2013; and WHEREAS, Executive Order B -29 -15 and the State Water Resources Control Board emergency regulations will remain in effect until February 28, 2016, unless extended due to continuing drought conditions; and WHEREAS, as an urban water supplier, as that term is defined in Water Code Section 10617, the City of San Luis Obispo ( "City ") is subject to California Code of Regulations, title R 10627 Packet Pg 220 15 Resolution No. 10627 (2015 Series) Page 2 23, section 865; and WHEREAS, the City's water supply is composed of surface water stored in the Whale Rock, Salinas, and Nacimiento reservoirs which are located outside of the City's limits but within the County of San Luis Obispo. Water from these reservoirs is shared among different public agencies and other beneficial uses; and WHEREAS, like the rest of California, the County of San Luis Obispo is facing an unprecedented drought resulting in significantly decreased water levels within the City's reservoirs; and WHEREAS, in an effort to further conserve water and to ensure adequate supplies exist within the City's water supply system, on September 16, 2014, the City Council adopted Resolution No. 10566 (2014 Series) limiting the outdoor irrigation of ornamental plants and turf to comply with the State's mandates; and WHEREAS, despite the City's water conservation efforts, the City's water supply is in critical condition due to record dry conditions. Based on the City's Water Projection Model, as of May 1, 2015, the City's has a projected three and a half years water supply and can be lengthened to an estimated four and half years if the City is able to meet the State's goal of a 12 percent per capita water use reduction; and WHEREAS, it is uncertain if drought conditions will continue through 2016 and beyond which makes it critically necessary to further manage water consumption during the ongoing drought to ensure that adequate water supplies are available in the long term in order to protect the public health, safety and welfare; and WHEREAS, in order to comply with the Executive Order and Emergency Regulations, and to ensure the City has adequate water for public health and safety, by this Resolution, the City intends on declaring a local drought emergency and implement all requirements and actions required in the Executive Order B -29 -15 and State Water Resources Control Board emergency regulations. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo, that for the reasons set forth herein, a local drought emergency now exists throughout the City of San Luis Obispo. Upon motion of Vice Mayor Ashbaugh, seconded by Council Member Christianson, and on the following roll call vote: AYES: Council Members Carpenter, Christianson and Rivoire, Vice Mayor Ashbaugh and Mayor Marx NOES: None ABSENT: None Packet Pg 221 15 Resolution No. 10627 (2015 Series) Page 3 The foregoing resolution was adopted this 2nd day of June 2015. V/114- N ay an Marx ATTEST: 4th on -ia; City Clerk APPROVED AS TO FORM: 2 hristine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this t- '— day of — 11 V-4- 2c. t j athany J. City Clerk Packet Pg 222 15 RESOLUTION NO. 10628 (2015 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, DEFERRING OR REQUIRING ALTERNATIVE LANDSCAPE PLANTING DURING THE DECLARED DROUGHT EMERGENCY WHEREAS, on January 17, 2014, Governor Edmund G. Brown issued the governor's Proclamation No. 1 -17 -2014 declaring a State of Emergency to exist in California due to severe drought conditions; and WHEREAS, on April 26, 2014, the Governor issued an executive order to strengthen the state's ability to manage water and habitat effectively in drought conditions and called on all Californians to redouble their efforts to conserve water; and WHEREAS, Water Code section 1058.5 grants the State Water Resources Control Board the authority to adopt emergency regulations in certain drought years in order to: "prevent the waste, unreasonable use, unreasonable method of use, or unreasonable method of diversion, of water, to promote water recycling or water conservation, to require curtailment of diversions when water is not available under the diverter's priority of right, or in furtherance of any of the foregoing, to require reporting of diversion or use or the preparation of monitoring reports "; and WHEREAS, on July 15, 2014 the State Water Resources Control Board adopted California Code of Regulations, title 23, sections 863, 864 and 865 (the "Emergency Regulations "), which requires, among other things, that urban water suppliers implement all requirements and actions of the stage of its water shortage contingency plan that imposes mandatory restrictions on outdoor irrigation of ornamental landscapes or turf with potable water; WHEREAS, on March 17, 2015 the State Water Resources Control Board expanded and extended the Emergency Regulations in response to the continuing drought conditions; and WHEREAS, on April 1, 2015 the Governor issued an Executive Order B -29 -15 which requires increased enforcement against water waste and mandates a 25% reduction in water use statewide; and WHEREAS, on May 5, 2015 in response to Executive Order B- 29 -15, the State Water Resources Control Board adopted regulations adding additional prohibitions and mandating that the City reduce its water use by 12 percent as compared to 2013; and WHEREAS, Executive Order B -29 -15 and the State Water Resources Control Board emergency regulations will remain in effect until February 28, 2016 unless extended due to continuing drought conditions; and WHEREAS, as an urban water supplier, as that term is defined in Water Code Section 10617, the City of San Luis Obispo ( "City ") is subject to California Code of Regulations, title 23, section 865; and R 10628 Packet Pg 223 15 Resolution No. 10628 (2015 Series) Page 2 WHEREAS, the City's water supply is composed of surface water stored in the Whale Rock, Salinas, and Nacimiento reservoirs which are located outside of the City's limits but within the County of San Luis Obispo. Water from these reservoirs is shared among different public agencies and other beneficial uses; and WHEREAS, like the rest of California, the County of San Luis Obispo is facing an unprecedented drought resulting in significantly decreased water levels within the City's reservoirs; and WHEREAS, in an effort to further conserve water and to ensure adequate supplies exist within the City's water supply system, on September 16, 2014, the City Council adopted Resolution No. 10566 (2014 Series) limiting the outdoor irrigation of ornamental plants and turf to comply with the State's mandates; and WHEREAS, despite the City's water conservation efforts, the City's water supply is in critical condition due to record dry conditions. Based on the City's Water Projection Model, as of May 1, 2015, the City's has a projected three and a half years water supply and can be lengthened to an estimated four and half years if the City is able to meet the State's goal of a 12 percent per capita water use reduction; and WHEREAS, it is uncertain if drought conditions will continue through 2016 and beyond which makes it critically necessary to further manage water consumption during the ongoing drought to ensure that adequate water supplies are available in the long term in order to protect the public health, safety and welfare; and WHEREAS, up to 30 percent of water used during the summer months is for landscape irrigation; and WHEREAS, newly planted landscapes use significantly more water during the establishment period than a mature landscape; and WHEREAS, in order to comply with the Executive Order and Emergency Regulations, and to ensure the City has adequate water for public health and safety, by this Resolution, the City intends on deferring or requiring alternate landscape for new landscape planting which require potable city water for irrigation. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. Environmental Determination, The Resolution is categorically exempt from environmental review pursuant to CEQA Guidelines Section 15307 (Actions by Regulatory Agencies for Protection of Natural Resources). SECTION 2. During the declared drought emergency, all new landscape planting located in City parks or on the grounds of City buildings which require potable city water for Packet Pg 224 15 Resolution No. 10628 (2015 Series) Page 3 irrigation shall be deferred and require a permanent alternative or interim landscape plan to be approved by the Community Development Director as set forth in Section 3a and 3b below. SECTION 3. During the City's declared drought emergency, all new landscape planting in private development projects which require potable city water for irrigation shall be deferred and require a permanent alternative or interim landscape plan to be approved by the Community Development Director. a) Alternative (permanent) landscape 1pans. Alternative landscape plans which are drought tolerant may be allowed to be installed during the deferral period as a permanent alternative, as approved by the City Community Development Director. Such plans may include hardscape, artificial turf, mulch, and select drought tolerant plant species. Such landscaping shall be irrigated with only drip emitters, micro spray or equivalent water saving devices that substantially reduce water use and achieve a minimum of a 50% reduction in water demand as compared to landscapes installed during normal water years. b) Interim (temporary) landscape plans. Interim landscape plans designed to control dust /erosion and maintain property aesthetics may be allowed during the deferral period, as approved by the City Community Development Director. Interim landscape plans are to be a temporary installation which will be replaced by a permanent landscape planting plan approved with an entitlement (e.g. Architectural Review, Use Permit, Subdivision) or building permit. There shall be an appropriate guarantee, as outlined in the Policy on construction Security Deposits Document, that the permanent landscape planting plan will be completed within 90 days of the end of the drought emergency or other appropriate time as determined by the Community Development Director unless an alternative landscape plan is approved and installed as noted above. Upon motion of Vice Mayor Ashbaugh, seconded by Council Member Christianson, and on the following roll call vote: AYES: Council Members Carpenter, Christianson and Rivoire, Vice Mayor Ashbaugh and Mayor Marx NOES: None ABSENT: None Packet Pg 225 15 Resolution No. 10628 (2015 Series) Page 4 The foregoing resolution was adopted this 2 °d day of June 2015. Vqo - Ma or Jan Marx ATTEST: APPROVED AS TO FORM: VCliristiiie Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this 1''6 ' day of a zo a, ntilony J. City Clerk Packet Pg 226 15 RESOLUTION NO. 10635 (2015 Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, IMPLEMENTING MANDATORY RESTRICTIONS ON OUTDOOR IRRIGATION OF ORNAMENTAL LANDSCAPES OR TURF WITH POTABLE WATER WHEREAS, on April 1, 2015 the Governor issued Executive Order B -29 -15 which requires the State of California to reduce water use by 25 %; and WHEREAS, on May 5, 2015 the State Water Resources Control Board adopted regulations mandating the City of San Luis Obispo reduce water use by 12 %; and WHEREAS, on June 16, 2015 the San Luis Obispo City Council adopted an ordinance amending Chapter 13.07 of the City's Municipal Code to include two day a week outdoor watering restrictions and limiting irrigation between the hours of 7:00 p.m. and 7:00 a.m.; and WHEREAS, by this Resolution, restricting the use of potable water for the outdoor irrigation of ornamental landscapes or turf by limiting irrigation to two days a week and between the hours of 7:00 p.m. and 7:00 a.m. will assist the City in complying with the State Water Resources Control Board 12% water reduction requirement. NOW, THEREFORE, BE IT RESOLVED, by the Council of the City of San Luis Obispo as follows: SECTION 1. The City Council hereby implements Section 13.07.030(B) of the Municipal Code; SECTION 2. The City Council hereby limits the outdoor irrigation of ornamental landscape or turf with potable water to two days a week in accordance with the following schedule: Even numbered addresses - Tuesday and Friday Odd numbered addresses - Monday and Thursday SECTION 3. Effective Date and Term. The effective date of this Resolution is July 16, 2015. This Resolution shall remain in effect until the State Water Board rescinds or allows expiration of the Emergency Regulations and the City Council formally rescinds its Drought Emergency declaration. Upon motion of Mayor Marx, seconded by Vice Mayor Ashbaugh, and on the following roll call vote: AYES: Council Members Carpenter, Christianson, and Rivoire, Vice Mayor Ashbaugh, and Mayor Marx NOES: None ABSENT: None R 10635 Packet Pg 227 15 Resolution No. 10635 (2015 Series) The foregoing resolution was adopted this 16`" day of June, 2015. Mayor n Marx ATTEST: APPROVED AS TO-fORM: istine Dietrick ity Attorney Page 2 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this Z ' day of '7::S-,, t o Packet Pg 228 15 RESOLUTION NO. 10629 (2015 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, ESTABLISHING A PERMIT FEE AND REGULATIONS FOR THE USE OF THE CORPORATION YARD NON - POTABLE WELL WHEREAS, as evidenced by Governor Edmund G. Brown's various proclamations, California is in a state of emergency due to severe drought conditions; and WHEREAS, separate but related to the drought, the State of California has adopted legislation commonly referred to as the Sustainable Groundwater Management Act, which requires, among other thing, that a groundwater management agencies must be formed to manage the groundwater basins underlying the agency's respective jurisdiction; and WHEREAS, the City of San Luis Obispo's ( "City ") water supply is composed of surface water stored in the Whale Rock, Salinas, and Nacimiento reservoirs which are located outside of the City's limits but within the County of San Luis Obispo. In addition to these surface water supplies, the City owns and operates a non - potable well located at the City's Corporation Yard. The well draws groundwater from the San Luis Obispo Valley Groundwater Basin which has been identified by the California Department of Water Resources as a medium priority basin as part of the California Statewide Groundwater Elevation Monitoring Program (Water Code section 10920 et seq.); and WHEREAS, the original purpose of this well was for use at construction sites within the City; and WHEREAS, over time, water from the well has been used by individuals and commercial enterprises for a variety of purposes not regulated by the City; and WHEREAS, in recognition of the drought and the importance of the groundwater resources management, and to protect the health, safety and welfare of the public, it is necessary for the City to regulate the use of the groundwater well at the City's Corporation yard. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: SECTION 1. Environmental Determination. The Resolution is categorically exempt from environmental review pursuant to CEQA Guidelines Section 15307 (Actions by Regulatory Agencies for Protection of Natural Resources). SECTION 2. During the City's declared drought emergency, a permit issued by the City Utilities Department will be required prior to any person obtaining water from the non - potable groundwater well at the City's Corporation yard. Water from this well may only be used for non- potable purposes for properties within the City of San Luis Obispo or those adjacent to or within the San Luis Obispo Valley Groundwater Basin as defined in Bulletin 118 issued by the R 10629 Packet Pg 229 15 Resolution No. 10629 (2015 Series) Page 2 California Department of Water Resources. Guidelines for the allowable uses of the water, user eligibility and application procedures consistent with this Resolution will be developed by the Utilities Director. The Utilities Director will have the authority to modify the guidelines, user eligibility and application procedures based on the severity of the drought conditions. If traffic issues, safety, abuses, or other similar concerns related to the well occur, the use and operation of the well may be further regulated or shut down at the discretion of the Utilities Director. SECTION 3. The City Council hereby adopts the following annual fees for use of the non - potable groundwater well at the City's Corporation yard by user type: Property owner inside the City limits: 50.00 Property owner outside the City limits, but in the San Luis Obispo Valley Groundwater Basin: $350.00 SECTION 4. Failure to follow the guidelines or follow other applicable procedures for use of the water will result in revocation of the user permit and forfeiture of access to the well. Upon motion of Vice Mayor Ashbaugh, seconded by Council Member Christianson, and on the following roll call vote: AYES: Council Members Carpenter, Christianson and Rivoire, Vice Mayor Ashbaugh and Mayor Marx NOES: None ABSENT: None The foregoing resolution was adopted this 2nd day of June 2015. Z fttal Ma or a Marx ATTEST: Packet Pg 230 15 Resolution No. 10629 (2015 Series) Page 3 APPROVED AS TO FORM: Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this S4'- day of 7 ony J. M " , City Clerk Packet Pg 231 15 R ______ RESOLUTION NO. _____ (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, RESCINDING THE LOCAL DROUGHT EMERGENCY AND ASSOCIATED RESOLUTIONS RESTRICTING WATER USE WHEREAS, on September 16, 2014 the City Council of the City of San Luis Obispo adopted Resolution No. 10566 (2014 Series), implementing mandatory restrictions on outdoor irrigation of ornamental landscapes or turf with potable water; and WHEREAS, on June 2, 2015 the City Council of the City of San Luis Obispo adopted Resolution No. 10627 (2015 Series), establishing a local drought emergency in the City of San Luis Obispo; and WHEREAS, on June 2, 2015 the City Council of the City of San Luis Obispo adopted Resolution No. 10628 (2015 Series), deferring or requiring alternative landscape plans during the declared drought emergency; and WHEREAS, on June 2, 2015 the City Council of the City of San Luis Obispo adopted Resolution No. 10629 (2015 Series), establishing a permit fee and regulations for the use of the corporation yard non-potable well; and WHEREAS, on June 16, 2015 the City Council of the City of San Luis Obispo adopted Resolution No. 10635 (2015 Series), implementing mandatory restrictions on outdoor irrigation of ornamental landscapes or turf with potable water; and WHEREAS, on April 7, 2017 Governor Brown issued Executive Order B-40-17, which lifted the drought emergency in all California counties except Fresno, Kings, Tulare and Tuolumne, and rescinded two emergency proclamations from January and April 2014 and four drought-related executive orders issued in 2014 and 2015. WHEREAS, the City of San Luis Obispo’s water model estimates greater than five years of water supply available, corresponding to the “Monitor” stage of the Water Shortage Contingency Plan; and WHEREAS, on May 25, 2017 Whale Rock Reservoir is 79 percent of capacity, Salinas Reservoir is 100 percent of capacity, and Nacimiento Reservoir is 83 percent of capacity; and WHEREAS, the City of San Luis Obispo’s reservoirs have adequate supplies to end the declared local drought emergency. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo as follows: Packet Pg 232 15 Resolution No. _____ (2017 Series) Page 2 R ______ SECTION 1. Environmental Review. The rescission of resolutions related to the Drought Emergency is not a "project" under the California Environmental Quality Act (CEQA), because the action does not involve any commitment to a specific project which may result in a potentially significant physical impact on the environment, as contemplated by Title 14, California Code of Regulations, Section 15378. SECTION 2. Local Drought Declaration and Water Use Restrictions. Based upon the City’s water supply conditions, as described above, the City Council hereby rescinds Resolution Nos. 10566 (2014 Series), 10627 (2015 Series), 10628 (2015 Series), and 10635 (2015 Series). SECTION 3. Discontinuation of Corporation Yard Well Access. Based upon the rescission of the declared drought emergency, the City Council hereby rescinds Resolution No. 10629 (2015 Series) thereby prohibiting the City’s Corporation Yard Well from being used by the general public as a temporary non-potable water supply. The prohibition on the public’s use of the City’s Corporation Yard Well as a temporary non-potable water supply shall become effective July 1, 2017. Upon motion of _______________________, seconded by _______________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this _____ day of _____________________ 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney Packet Pg 233 15 Resolution No. _____ (2017 Series) Page 3 R ______ IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 234 15 Meeting Date: 6/20/2017 FROM: Derek Johnson, Assistant City Manager SUBJECT: COMMUNITY BUDGET TASK FORCE RECOMMENDATION Adopt a Resolution (Attachment A) to create a Community Budget Task Force and define the term, responsibilities and the process for Council appointments. DISCUSSION Background The adoption of Fiscal Sustainability and Responsibility Major City Goal for the 2017-19 fiscal years marks the third consecutive financial planning period that features financial sustainability as an organizational and community priority. The City has a history of fiscal responsibility and the activities described in the goal work plan build on the progress made as part of implementing the 2013-15 and 2015-2017 Major City Goals. A significant component of the 2017-2019 work program includes the establishment of an ad hoc Community Budget Task Force (“Task Force”) to provide direct input on priorities and strategies for the City Council to consider as the City continues its path of fiscal sustainability. Community Budget Task Force Scope of Work The scope of the Task Force effort is broken down into five phases: 1) Task Force selection and appointment; 2) Task Force background and information; 3) Task Force recommendations; 4) City Council review of Task Force recommendations; and 5) Implementation of recommended actions. The Task Force is proposed to be advisory to the City Council with the following charter: Provide recommendations to the City Council on priorities and strategies to close the budget gap and address structural budget challenges to maintain fiscal health and sustainability. Community Budget Task Force Members Staff is recommending that the Council approve the attached Resolution (Attachment A) forming a nine-member task force. It is recommended that each Council Member directly appoint one member and the remaining four be appointed by an ad-hoc committee of two Council Members. Staff recommends that the Council consider the following qualities when considering the direct and ad-hoc committee appointments of Task Force members: 1. City Resident 2. General understanding of City function(s) Packet Pg 235 16 3. Direct or indirect financial or accounting experience 4. Demonstrated success working on committees, task force or other bodies 5. Passion and eagerness to participate 6. Willing to prepare for meetings and attend schedule meetings 7. Supportive of process and willing to express their own opinion 8. Interest in learning as much as possible The Resolution also adopts guidelines (Exhibit A) to clarify the respective roles of each participant in the citizen advisory committee process. The guidelines outline the roles, responsibilities and relationship of the Task Force and staff. This helps to clarify expectations and understanding of the overall process so that the Task Force and staff can collaboratively move toward accomplishing the specific goals within the required schedule and budget. Selection Process The following is a recommended appointment schedule: 1. Formation of Community Budget Task Force June 20 2. City Council Ad-Hoc Committee Appointment June 20 3. Individual City Council Appointment July 18 4. At-Large Ad-Hoc Committee Appointment Application Period June 21-July 25 5. Ad-Hoc Appointments July 30 Once Council selects a two-member ad-hoc committee, applicants will be interviewed using the process established for all City advisory bodies, except that the ad-hoc committee will have authority to make the final appointments for all four positions. The purpose is to allow the Council to make appointments so that the orientation can begin in August and the meetings can begin in September with enough time to provide recommendations to the City Council by December 2018. If the council wishes, a staff member with knowledge of the City’s financial situation could be an advisor to the ad-hoc council committee. The Council should provide such direction if this is desired assistance requested from staff. Work Effort by Budget Task Force It is estimated that the Community Task Force will meet two times per month during the months of September, October and November in order to provide recommendations to the City Council in time for consideration for the preparation of the 2018-2019 supplemental budget. Attachment B shows the proposed approach for the anticipated six Task Force meetings. The Task Force will self-appoint a Chairperson who will be the spokesperson for the group. Staff is recommending that Task Force meetings be facilitated by an independent facilitator so that staff can be actively engaged in the discussion and focus attention on providing supportive information. Task Force members should anticipate spending approximately 10-15 hours per month in preparation and attendance of meetings. More time will be required for members who decide to actively work on shaping the recommendations for City Council consideration. Packet Pg 236 16 It has been staff’s experience that successful public and stakeholder participation in the budget process depends not only on the informed financial analysis by professional City staff and in this case, actuarial consultants; but also on meaningful community participation about strategies and priorities to maintain fiscal sustainability. Typical factors that contribute to the acceptance of decisions made by appointed bodies include: being treated with respect, transparency, perceived lack of bias, and decisions that are responsive to public input and information. The community and all stakeholders have a reasonable expectation that any process that affects the outcome the City’s finances should be transparent and fair. To that end, Task Force guidelines describes the framework for collaborative communication amongst the task force, staff and the public. Task Force meetings will be open to the public and will have meeting notes and recommendations posted at the City’s website. Updates to Council will be provided by staff as needed. CONCURRENCES The proposed Task Force framework was discussed by Department Heads who provided insight s and input into an advisory structure that could offer a broad range of perspectives and interests FISCAL IMPACT It is estimated that an independent facilitator will cost approximately $10,000-$15,000. This cost can be covered in the Financial Plan. ALTERNATIVES The approach described above has been used successfully in many other jurisdictions. The City Council could decide to appoint all members through an application process or appoint a different number of members. Staff recommends that the Task Force not exceed 13 members as too large of group complicates scheduling and is considered the maximum size for optimal discussion and decisions. Lastly the council could change the purpose (narrow or broaden) or could decide that the task force is not needed to support this Major City Goal. Attachments: a - Citizen's Task Force Resolution b - Timeline Packet Pg 237 16 R ______ RESOLUTION NO. (2017 Series) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, CREATING THE COMMUNITY BUDGET TASK FORCE TO PROVIDE RECOMMENDATIONS FOR PRIORITIES AND OPTIONS TO MAINTAIN FISCAL SUSTAINABILITY WHEREAS, the City Council adopted Fiscal Sustainability and Responsibility Major City Goal for the 2017-2019 Financial Plan; and WHEREAS, the work-program for the Fiscal Sustainability and Responsibility Goal has 29 key strategies identified in the action plan to maintain fiscal sustainability; and WHEREAS, one of the 29 action items are to establish a Citizen Task Force to make recommendations to the City Council to address budget challenges; and WHEREAS, the Council of the City of San Luis Obispo has a long history of engaging the community about topics of community wide interest; and WHEREAS, the City’s Public Engagement Manual identifies three communication strategies, inform, consult and collaborate depending on the complexity and important of the issue; and WHEREAS, fiscal matters that have the potential to impacts employees, capital investments, levels of services and the overall financial position of the City requires an interactive and collaborative process that actively engages the public to develop thoughtful recommendations; and WHEREAS, the creation of a Community Budget Task Force will provide the opportunity to directly engage the community about important budget issues; and WHEREAS, the composition of the Community Budget Task Force should be representative of the community interests with a requirement that participants live in the City; and WHEREAS, establishing Ground Rules and Terms of Engagement will provide a framework for collaborative communication; and WHEREAS, the City Council has duly considered all evidence, including the testimony of interested parties, and the evaluation and recommendations by staff presented at said hearing. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo that a Community Budget Task Force is hereby created with a composition, term, charge, ground rules and staff support as follows: SECTION 1. COMMUNITY BUDGET TASK FORCE. Packet Pg 238 16 Resolution No. _____ (2017 Series) Page 2 R ______ 1. The purpose of is to Provide recommendations to the City Council on priorities and strategies close the budget gap and address structural budget challenges to maintain fiscal health and sustainability SECTION 2. MEMBERSHIP AND APPOINTMENT PROCESS 2. The Community Budget Task Force shall be comprised of nine members. 3. Each Council member shall submit one appointment to the City Clerk’s Office by 5:00 p.m. on July 18, 2017. 4. A Council Ad-Hoc committee comprised of Council members ____________________ and ___________________ shall review applications and appoint the remaining four members by August 1, 2017. 5. The application period for the four Ad-Hoc Committee appointments shall be from June 21-July 25, 2017. 6. All appointees shall be City residents. 7. The Community Budget Task Force is hereby established until January 1, 2018. SECTION 3. COMMUNITY TASK FORCE ADMINISTRATION 1. The City will provide staff support to the Community Budget Task Force with the Assistant City Manager to be primarily responsible for providing this support, including but not limited to the preparation of agendas, and minutes, compilation of material for discussion at Task Force meetings, and assistance with public outreach efforts. 2. Staff is authorized to retain a meeting facilitator within purchasing policies and the role of the facilitator will be to support the Community Budget Task Force. 3. The Community Budget Task Force Guidelines as shown in Exhibit A, and as may be amended by the City Council, shall apply. Upon motion of , seconded by , and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this ___ day of ____________, 2017. Packet Pg 239 16 Resolution No. _____ (2017 Series) Page 3 R ______ ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 240 16 Resolution No. _____ (2017 Series) Page 4 R ______ EXHIBIT A COMMUNITY BUDGET TASK FORCE GUIDELINES City of San Luis Obispo 1. Introduction The purpose of these Guidelines is twofold: 1) To clarify the respective roles of each participant in the Community Budget Task Force (“Task Force”) process; and 2) To outline the roles, responsibilities and relationship of Community Budget Task Force and Staff to clarify expectations and understanding of the overall process, so that Task Force and Staff contribute to moving toward accomplishing the committee’s specific goals within an appropriate schedule and budget. The advisory committee process is a collaborative one involving an often diverse array of individuals, stakeholders, and viewpoints, levels of expertise and matters of concern. The public, Task Force appointees, and respective staff all benefit in having a clear understanding of their respective roles and responsibilities. An effort has been made to cover all essential aspects of the task force activities, such as how appointments are made, how long each member’s term is, the responsibilities of different participants, conflict of interest issues, and meeting procedures. Nonetheless, these Guidelines are not exhaustive, they do not incorporate statutes and regulations which may apply to Task Force activities. The Guidelines strive to make adequate reference to other rules, as appropriate. 2. Applicability These Guidelines apply to the Council-appointed Task Force whose mission is to: Provide recommendations to the City Council on priorities and strategies close the budget gap and address structural budget challenges to maintain fiscal health and sustainability. 3. Establishment of Community Budget Task Force The Task Force is advisory to the City Council. This Task Force is established by the City Council and is not specifically required by any State laws or regulations. Therefore, the City Council has discretion to create, modify, and terminate the Task Force, its membership, mission statement, schedule, etc. at any time. The Task Force is an agent of the City of San Luis Obispo Packet Pg 241 16 Resolution No. _____ (2017 Series) Page 5 R ______ and members should be cognizant that their actions as individuals or as a whole can have consequences to the City. 4. Task Force Authority The Task Force is advisory in nature and has no authority to approve, deny, or require modify any policy within the general purview of the Task Force. The Task Force’s advice shall be conveyed to the City Council via a staff report. When recording votes in meeting minutes, members voting for and against items will be noted. Staff is assigned responsibility for working with the Task Force to present recommendations by January 1, 2018. 5. Appointment Process and Membership Term A) Size The size of a Task Force shall be established by the City. The Task Force shall have an odd number of members; this eliminates ambiguity as to what constitutes a quorum, and minimizes the possibility of tie votes. B) Composition The composition of a Task Force shall be determined at the time of its creation, to ensure that specific community segments and/or other interest groups are represented in the membership. The Task Force will be created by Council resolution. C) Vacancies and Application Process A vacancy or vacancies on a Task Force shall exist: 1) When the committee is created 2) When a member or members is/are formally removed by the City Council, or 3) When the Council receives and acknowledges a letter of resignation from an incumbent. Vacancies on the Task Force shall be advertised by the City Clerk. Applications for Task Force membership shall be submitted on forms provided by the City Clerk, and shall be accepted by the Clerk. Vacancies shall be filled by the Ad-Hoc committee that selected members through the at-large application process. The temporary absence of members to fill vacancies as described in this section shall not affect any recommendations nor cause any delay in the process. Packet Pg 242 16 Resolution No. _____ (2017 Series) Page 6 R ______ D) Selection Process Each Council member shall select one member. Four members shall be selected by an Ad-Hoc Council committee. The Ad-Hoc Committee, upon the close of an application period, shall review and interview each applicant and appoint four members. All Task Force members shall be City residents. Additionally, when selecting all members, the following qualities should be taken into consideration: 1. General understanding of City function(s) 2. Direct or indirect financial experience 3. Demonstrated success working on committees, task force or other bodies 4. Pre-existing passion and eagerness to participate 5. Willing to prepare ahead for meetings 6. Supportive of process and City and willing to express their own opinion 7. Strive to learn as much as possible E) Term of Office The term of office for a Task Force and its members is established by the City Council when it creates Task Force. The Task Force shall serve at the discretion of the Council for the term of appointment outlined in a resolution. 6. Task Force Operations A) Officers and Rules of Conduct The responsibilities of the Task Force also include an election of least a Chair, and Vice-Chair. The Chair shall lead all meetings, be the primary spokesperson for the Task Force, and be the primary committee liaison to City staff and the public. Staff in consultation with the Chairperson shall develop the agenda for each Task Force meeting. The Vice-Chair shall fulfill the duties of Chair in the latter’s absence. Meetings shall be facilitated by an independent facilitator. The Recording Secretary will be the Assistant City Manager or his/her designee, who will take action minutes of motions and make a digital recording of each meeting. At a minimum, these minutes shall clearly convey actions and motions taken by the Task Force. These minutes are to be considered, amended as needed and approved by the full task force at the earliest possible time, and signed by the Chairperson. In addition, the task force may adopt specific rules of conduct and procedure, as long as such rules are consistent with applicable laws and regulations (including these Guidelines). B) Meeting Procedure The Task Force is subject to the Brown Act, which set standards for public notice as to meeting time, date and location as well as items to be discussed. Significant implications are as follows: Packet Pg 243 16 Resolution No. _____ (2017 Series) Page 7 R ______ 1) Noticing of all Task Force meetings, including time, location and an agenda, must be posted in a public place within the applicable area. Efforts should be made to provide adequate public notice beyond minimum Brown Act requirements of seventy-two (72) hours. 2) All Task Force meetings must be open and public. Meetings are to be held in a facility which makes adequate provision for attendance by all interested members of the public. 3) Members of the public are to be given an opportunity to speak to the Task Force on any regular agenda item at the time it is being discussed. Members of the public will also be given an opportunity to speak to any relevant non-agenda item. All public speakers are subject to reasonable time constraints established by the Task Force Chairperson and any adopted procedures. All public speakers are to identify their names and relevant business and/or personal interests they are representing for the record. 4) The Task Force will attempt to establish a consistent regular meeting time and location in their rules of conduct. 5) Minutes of Task Force meetings will be kept on file by Administration. These minutes shall be available for any interested person to examine. 6) The Task Forces Force elect officers no later than its second meeting and until such time, the Assistant City Manager shall serve as the Chair Pro-Tem. 7) Meetings shall run in a parliamentary style. Substantive issues will have higher priority than matters of procedural detail. The Chair has discretion in guiding discussion of items among Task Force members while allowing for appropriate public input. 8) Staff may address the Task Force at any time, with timely recognition by the Chair. 9) Quorum: A majority of the members of the Task Force constitute a quorum. Decisions are made by a majority of the members present and voting. No business may be transacted if fewer than a quorum is present. Formal votes by a committee are to have a motion and second, prior to allowing further discussion and a vote. 10) Members of the Task Force shall not vote on issues which involve a legal or ethical conflict of interest or duty (See section 7) 11) Subcommittees: Task Forces may select subcommittees to focus on issues or subjects meriting more detailed work outside of the full task force. Subcommittees are made up of Task Force members only, and must number fewer than a quorum of the full Task Force. Subcommittee meeting arrangements may be set by either the staff or the Task Force. Such meetings are not legally required to be noticed or posted, but every effort should be made by a subcommittee officer or member to notice and/or post the meetings, as they are open to any interested member of the public. Information about their time and location is to be made available through the overall Task Force secretary and through Administration staff. Subcommittees shall choose a Chair and a Vice-Chair, and may choose a Recording Secretary for preparing informal minutes. A report from any subcommittee meeting shall be made at the next full Task Force meeting. Staff support for subcommittee meetings may be provided, but is not required. Packet Pg 244 16 Resolution No. _____ (2017 Series) Page 8 R ______ C) Attendance Community Budget Task Force members shall make every effort to attend regular meetings. Any member who is unable to attend any meeting shall contact the Community Budget Task Force Chair or Assistant City Manager at least seventy-two (72) hours prior to the meeting. Three (3) consecutive absences or absences by a member shall be grounds for dismissal from the Task Force, subject to the discretion of the Council. D) Appearance on Community Budget Task Force’s behalf The Chair, Vice-Chair, or other duly authorized Task Force member shall speak for the task force at any applicable public hearing or other meeting as authorized by the Task Force. Individual members of Community Budget Task Force not so designated, who do testify at a public hearing or other meeting, shall clearly identify themselves as speaking individually as a member of Task Force, and shall clearly indicate that they are not authorized to speak for the full group. E) Timely adjournment of evening meetings To encourage public participation, evening meetings of Task Force will be organized, agendized, and run to finish at a reasonable hour. If evening meetings habitually running past 9:30 PM, staff and the Chair will work together to shorten the agendas and if necessary, to expedite task force discussion and action on items. 7. Conflicts of Interest Community Budget Task Force members are not considered to be “public officials” as defined in § 82048 of the California Government Code, and therefore are not subject to the State Political Reform Act and its disclosure provisions (Government Code §§ 81000 et seq.). Nevertheless, Community Budget Task Force members shall remove themselves from all discussions and votes on matters in which they have any direct personal financial interest, or where the member’s professional allegiance and/or personal bias cannot be set aside to allow the member’s fair consideration of the issue(s) at hand. In gauging such extra-legal conflicts of interest and/or duty, each member shall exercise careful judgment and introspection in giving priority to the interests of fairness and objectivity; if there is any reasonable doubt that the member has a conflict, the member shall refrain from participation in the task force’s deliberations and vote(s). Should a member not refrain voluntarily, and should the member’s participation specifically be challenged by another Task Force member, staff, or the public, the member’s participation on any item of official task force business may be prevented by a two-thirds majority vote of the full Task Force (i.e., at least two- thirds of the total incumbent membership, including the member in question). Pervasive or recurring conflicts of interest and/or duty should lead a member to resign voluntarily from a Task Force, and may be grounds for a dismissal by the Council. Packet Pg 245 16 Resolution No. _____ (2017 Series) Page 9 R ______ 8. Community Budget Task Force and Staff Responsibilities A) Community Budget Task Force Member Responsibilities The responsibilities of the individual Task Force members include: 1) Punctually and fully attend all regular and special meetings of the Task Force and all relevant subcommittee meetings, to the maximum possible extent; 2) Come to all meetings fully prepared, having reviewed the agenda and all related written/graphic material available before the meeting; 3) Conscientiously follow high ethical standards in putting the broad public interest ahead of any personal interest and/or bias, and to abstain from all discussions and votes where this is not possible; 4) Promote full and open discussion of all matters of official task force business; 5) Support the task force Chair, Vice-Chair, and staff in maintaining order, keeping discussions relevant to the business at hand, and following proper procedures, while giving primary attention to matters of substance. 6) Be cognizant of the time line and constraints and strive to deliver a recommendation to the City Council by January 1, 2018. B) ADMINISTRATION Staff Responsibilities Staff responsibilities in supporting the Task Force include: 1) Timely completion of deliverables within budget. 2) Schedule all Task Force meetings and plan for all facilities, distribute written/graphic materials, notices, agendas, etc. For such meetings, coordinate necessary staff participation and guest speakers; 3) For Task Force meetings, as appropriate, prepare recommendations and other material for Task Force review and comment. Advise the Task Force on matters of both substance and procedure; 4) Assist the Task Force Chair in promoting full and open participation by all Task Force members and other people in attendance at any meeting, keeping discussion pertinent to the business at hand; 5) Handle information requests for material and general information related to the official business of the Task Force; C) City Attorney Staff support to the Task Force will not be provided by the City Attorney. Specific legal issues are to be directed through Administration to the City Attorney for response. Packet Pg 246 16 Jun-17 Jan-18 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 COMMUNITY BUDGET TASK FORCE WORK PROGRAM November 2017 Meeting #5 Draft Recommendations 10/5/2017 Meeting #3 CalPERS Sep-17 Meeting #2-Financial Overview and Background 6/20/2017 City Council Task Force Approval 6/20/2017 - 7/25/2017 Task Force Application Period October 2017 Meeting #4 Brainstorm Recommendations Sep-17 Task Force Meeting #1 Orientation & Background 7/30/2017 Ad-Hoc Council Appointments November 2017 Meeting #6 Final Recommendations December 17 City Council Receives Recommendations July 18, 2017 Individual Council Appointment Deadline Packet Pg 247 16 Page intentionally left blank. Packet Pg 248 16 Meeting Date: 6/20/2017 FROM: Xenia Bradford, Interim Finance Director SUBJECT: BUSINESS LICENSE COMPLIANCE PROGRAM IMPLEMENTATION PLAN RECOMMENDATION Approve Business License Compliance implementation plan. REPORT-IN-BRIEF The purpose of this item is to inform the Council and community about the impending efforts to launch a business license compliance program and receive conceptual approval of proposed enforcement. The Municipal Code requires a business license to conduct business in San Luis Obispo. Based on community feedback from businesses owners who comply with business license requirements who have over the years asked that they city level the playing field and uniformly apply the ordinance to all businesses. In the 2015-17 Financial Plan, the Council adopted a business license compliance program. The concept is that a skilled and focused consultant will identify unlicensed businesses within the community and then seek compliance. The consultant uses databases and other means to identify business that may be out of compliance and then reaches out to that business to determine the facts and seek compliance. In October 2016, the Council approved a contract for business license compliances services with HDL Software, LLC. Utilization of HDL consulting services, will enhance equitable enforcement of business license requirements through educational outreach and enforcement to uniformly enforce business license requirements across all businesses subject to the Municipal Code requirement. Based on the analysis presented to the Council with 2015-17 Financial Plan, the cost of the services will be offset by increased revenue. The cost is at 35% of recovery; therefore, there is no direct cost to the City unless revenue is recovered. It is estimated that ultimately there will be a net increase in business license tax revenues after offsetting the cost of providing the compliance. This report outlines the implementation timeline and methodology for Business License Compliance program. Additionally, Council concurrence on policy choices is sought before the program is launched. DISCUSSION The first question may be – “why should the City enforce business license compliance?” The City Charter Municipal Code section 5.01 establishes a duty for the Finance Director to enforce the provisions of the Business License Program, however, there are limited City resources to enforce the requirements of the Business License Program. The result is lack of uniformity of Packet Pg 249 17 enforcement across all businesses and resulting frustration of compliant business owners. Ultimately, the compelling reason for focused enforcement is equitable application of the ordinance. Staff has received complaints that those that do not pay have an unfair business advantage in that they avoid the costs of this requirement. City of San Luis Obispo Municipal Code Chapter 5.01 sets forth the City’s Business License Program. The purpose of the city’s business license regulations is to provide for necessary regulation of lawful businesses being conducted within the city in the interest of the public health, safety and welfare of the people of the city. While due diligence will be exercised in reasonably assuring compliance with all city policies, regulations and ordinances before issuing a business license, the primary focus of the city’s business license regulations is to provide reasonable assurance that businesses operating in the city are doing so in compliance with the city’s planning and building policies, regulations and ordinances; in compliance with the city’s business tax provisions as set forth in Chapter 3.01, and in compliance with the city’s storm water quality ordinance, set forth in Chapter 12.08. Furthermore, City of San Luis Obispo Municipal Code Chapter 3.01 sets forth business tax certification requirements. Although the City’s business tax certification is entirely separate from the license provisions, the two ordinances operate in conjunction with one another. The purpose of the City’s business tax requirements are solely to raise revenue for general municipal purposes and are not intended for regulation. The code sections above apply to businesses. The City’s Municipal Code defines a business as follows: Business shall mean and include professions, trades, vocations, rentals, leases, enterprises, establishments and occupations, and all and every kind of calling, any of which is conducted for the purpose of earning in whole, or in part, a profit or livelihood, whether or not a profit or a livelihood actually is earned thereby, whether paid in money, good, labor or otherwise, and whether or not the business has a fixed place of business in the city. The City’s Business License Program exempts certain types of business es from the license requirements. Specifically, the following businesses are exempt: 1. Businesses owned by a minor under the age of 18 years old. 2. Charitable, Religious and Nonprofit Organizations. 3. Instances where there is a conflict with Federal or State laws or contractual agreements. Business license fees are charged on annual basis and are established by Council resolution and business license tax is fifty cents per thousand dollars of gross receipts or a minimum of $25 annually as defined by Municipal Code section 3.01. Packet Pg 250 17 With the 2015-17 Financial Plan, Council adopted implementation of a business license compliance program using consultants to identify unlicensed businesses within the community. In October of 2016 Council approved a contract for business license compliance services with HDL Software, LLC. One of the primary reasons that the City selected HDL for Business License Compliance was based on their business friendly and education centric approach. HDL’s program is based on the premise of equal enforcement of the City’s regulations for all businesses conducting business within the city in the interest of the public health, safety and welfare of the people of the city. Through proven discovery services provided by HDL, entities subject to licensure/taxation that are not currently registered or otherwise non-compliant are identified. HDL provides communication and outreach to identified businesses in every effort to simplify the process for customers and utilizes a variety of mediums for communication including mail, telephone, and email and web-site access. HDL also provides with a Business Assistance Center that provides customer support and service center. City staff proposes the following implementation plan with HDL Staff is seeking feedback from Council about the implementation plan noted below. IMPLEMENTATION PLAN HDL has access to the City’s business license database. The purpose for granting access is to analyze existing businesses that have been part of the City’s Business License Program. HDL’s program specializes not only in identifying business physically located within the boundaries of the City, but also those that may conduct business within the City while having an intermittent or no physical presence at all. HDL discovery services include a data portfolio, utilizing data provided by the City, as well as the HDL data. HDL team builds an enhanced listing of entities subject to taxation in the city. These entities are electronically matched to the existing files of the City using data matching algorithms, allowing HDL staff to identify which entities are in compliance with the City’s requirements and which entities require follow-up. HDL also utilizes field surveys to provide on-site verification of data culled from other sources. HDL does not rely on electronic matching alone. Records are reviewed by HDL team members and City staff as needed, filtering out records that may lead to erroneous or unnecessary contacts. The following is an outline of the steps that staff has and/or will be taking to roll out the program: 1. A Frequently Asked Questions and answers has been posted on the City website to aid business community in understanding current City requirements and the reasons behind the program. 2. July 2017: General outreach by City staff and HDL representatives to business organizations including but not limited to the Chamber of Commerce and the Downtown Association so that their members are aware that this effort is underway. Packet Pg 251 17 3. Outreach to businesses identified by HDL through discovery process. Notices will be sent to businesses that are potentially out of compliance with the City’s Business License requirements and asking the business to submit a business license application packet. Full customer support will be provided by HDL via telephone and web-site access to help the business obtain compliance. HDL will send out notices in batches to a selection of businesses to allow for processing time. HDL will continuously review available data identifying businesses potentially not in compliance with the City Municipal Code and monitor compliance. 4. If the business is identified in violation of the Municipal Code sections 5.01 and 3.01, a notice of violation and an administrative citation will be issued if the business does not comply with the notice of violation. As established by the Municipal Code, for the first violation, the administrative citation will be $100. If the business still fails to comply, then a second citation will be issued in the amount of $200. Further failure to comply will result in a third violation of $500. Consistent with the City’s current application of the Municipal Code business license and business tax requirements, the City will issue the first citation 30 days following the first notice issued by HdL. HdL will continue outreach to identified businesses sending a minimum of three notices, and subsequent citations will be issued at 60 days and 90 days increments from the original notice. If a business does not comply, other enforcement options will be pursued by HDL or the City which may include but not limited to turning an account to collections or pursuing a court action. 5. As established by City of San Luis Obispo ordinance, late fees in the amount of $15 per month will be applied to outstanding unpaid balances from the time that non-compliance is discovered. Late fee will be applied to the business account, where the balance includes all fees, taxes, and fines due to the City. 6. No retroactive penalties will be applied for this phase on the business license compliance program. According to the Municipal Code, the City could seek up to three years of business license fees, taxes and associated fines and penalties for any unlicensed business which is found to have been operated within that time period. This program will not seek retroactive penalties, license fees or taxes. This is limited to this program – there may be special circumstances outside of the implementation of this program that warrant retroactive payment. Staff is not aware of any instances at this time but this limited waiver of the retroactive enforcement as part of this program should not be interpreted to waive this provision in perpetuity or in circumstances outside the framework of this Packet Pg 252 17 program or after this program is discontinued. The City’s executed contract with HDL is for two years and the compliance efforts will continue throughout this timeframe. It is worth noting that staff anticipates that during this timeframe there will be some complaints about this program (or at least this has been the case in other cities that have implemented a business license/tax compliance program). Every attempt will be made to explain the rationale for the program and ensure the consultant provides exceptional service to the people expressing concern. If there are complaints about the program they should be directed to Xenia Bradford, Interim Finance Director who will address the concerns as expediously and professionally as possible. ALTERNATIVES 1. The Council may direct the Finance Director not to proceed with business license enforcement program and direct the City staff to return with a proposal to amend the Municipal Code. The Municipal Code established a duty to enforce business license program. This action is not recommended. The purpose of the city’s business license regulations is to provide for necessary regulation of lawful businesses being conducted within the city in the interest of the public health, safety and welfare of the people of the city. Enforcement of the business license program is intended to create an equitable and even playing field for all businesses operating within the City that require a license. 2. The Council could direct staff to revise the Business License compliance implementation plan. Staff recommendation is to waive retroactive application of fees, penalties and fines. The Municipal Code section 5.01.501, provides with adjustment powers. Alternatively, Council could direct the Finance Director to collect business license fees and tax based on evidence provided by HDL to the date when a business was first in operation without a license. This approach may result in enhanced fact finding efforts by HDL and potentially subsequently the City staff. Attachments: a - Executed Contract with HDL Business License Compliance Packet Pg 253 17 Packet Pg 254 17 Packet Pg 255 17 Packet Pg 256 17 Packet Pg 257 17 Packet Pg 258 17 Packet Pg 259 17 Packet Pg 260 17 Packet Pg 261 17 Packet Pg 262 17 Packet Pg 263 17 Packet Pg 264 17 Packet Pg 265 17 Packet Pg 266 17 Packet Pg 267 17 Packet Pg 268 17 Packet Pg 269 17 Packet Pg 270 17 Packet Pg 271 17 Page intentionally left blank. Packet Pg 272 17 Meeting Date: 6/20/2017 FROM: Christine Dietrick, City Attorney Prepared By: Kelly White, Legal Assistant SUBJECT: SUPPORT FOR THE GOALS OF CALIFORNIA SENATE BILL 562: THE HEALTHY CALIFORNIA ACT RECOMMENDATION Consider a Resolution expressing the City’s support for the goals of California Senate Bill numbered 562 and known as The Healthy California Act. DISCUSSION In February of this year, California State Senators Lara and Atkins introduced a bill, The Healthy California Act (SB 562), proposing to create “the Healthy California program to provide comprehensive universal single-payer health care coverage and a health care cost control system for the benefit of all residents of the state.” The idea behind the bill is to create a new, independent public entity within the California government, to be guided by a Board, that will work to consolidate all the programs currently existing within California that provide health care, no matter how they are funded or which sub-set of residents they serve, into one system of health care provision, “Healthy California”. The objective of the system is to ensure every resident of the State receives all the medical services and medications they need with no costs out-of-pocket. Payment is proposed to come from the State – the “single-payer”. The bill as proposed did not provide a plan to fund the program and no funding program has been established as of the date of this report. As currently written, SB 562 proposes, in part, that Healthy California be governed by a Board of nine, unpaid members appointed by either the Legislature or Governor, with each appointee being required to come from a specified citizen group, but all having expertise related to health care. It also calls for the Board to be guided by a "22-member public advisory committee” with its membership being appointed by the California Health and Human Services Agency. Every individual whose primary place of abode is in the State would be eligible to enroll in Healthy California, regardless of immigration status, and once enrolled, a member would not be required to pay any premium, co-pay, deductible or to share in the cost of their care in any way for the benefits covered by the program. These covered benefits are broadly defined as those already covered under existing programs and the care determined to be medically appropriate by the member’s health care provider, with that provider being selected by the member from those qualified by the Heathy California Board to provide services within the State. Many Senators, including the bill’s authors, acknowledge that the language of SB 562 is broad, and some components are vague or certain necessary details are absent, due to the scope of the program being proposed and how early the bill is in its path to completion. However, the majority of Senators approving the bill believed moving the bill forward and having its authors work with the Assembly to make it complete was a better choice than taking more time in the Packet Pg 273 18 Senate to work out the details. The bill now needs to progress through the committees of the Assembly, achieve approval of a final draft by the full Assembly and concurrence by the full Senate, go to the Governor, and then, most likely, be put on a statewide ballot for approval by the voters, due to the substantial increase in State spending being proposed and the conflicts with existing State law that would exist. The current form of SB 562 has been analyzed for the Senate Committee on Health, Senate Appropriations Committee, and the full Senate, with additional analysis sponsored by the California Nurses Association, a supporter of the bill, being completed by a research team at the University of Massachusetts Amherst (all of which can be found in the Council Reading File). These analyses have reached different conclusions as to the final annual cost associated with implementation of Healthy California, ranging from $330 billion to $400 billion. This difference results from the unfinished status of the bill, about which each study made different assumptions on everything from final funding sources and covered benefits, to payment methodology and provider participation. Until SB 562 reaches a stage where greater clarity and specificity on these issues is provided, a truly accurate cost analysis cannot be done. Some key details that need to be worked out, and issues that may arise during implementation, are summarized on pages 5-8 of the analysis done for the Senate Appropriations Committee (Attachment B). An additional note of importance is that the League of California Cities, upon which the City of San Luis Obispo usually relies for analysis of the effect a piece of legislation may have, has not yet formed a positon on SB 562. The League may do so in the future, once more details of the bill are certain, but at this time has not made a determination. Because of the many uncertainties regarding the final form of Healthy California, the Resolution being recommended to Council does not support the specific language of SB 562, but instead the goal of its authors to create a system in California that provides every resident all the medical care they need with no out-of- pocket costs. As drafted, the proposed Council Resolution conveys City support of the bill’s core objectives to the authors as they move forward with the extensive work still needed to complete the process of defining the Healthy California program, its funding sources and implementation plan. ENVIRONMENTAL REVIEW This resolution expressing conceptual support is not project under CEQA and therefore no environmental review is required FISCAL IMPACT There are no direct fiscal impacts associated with this preliminary action. As the bill in question does not yet provide a method for funding the program it is proposing, there is no way to definitively gauge the financial impact on the City were the program to be implemented. Because of this uncertainty, the Resolution supports only the goal of the bill, not its text. More analysis would need to be done after the legislature settles on a financing method to determine the fiscal impact of implementation. Packet Pg 274 18 ALTERNATIVES The Council may choose to make modification to or not support the Resolution. If changes are desired, Council should specify the items that require revision. Attachments: a - Resolution Support - SB562 b - Senate Appropriations Analysis c - Council Reading File - Senate Committee on Health Analysis d - Council Reading File - Amendment made 5-25-17 e - Council Reading File - Senate Floor Analysis f - Council Reading File - Pollin-Economic-Analysis-SB-562 g - Council Reading File - SB562 Text-As Amended Packet Pg 275 18 R ______ RESOLUTION NO. _____ (2017 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, IN SUPPORT OF THE GOAL OF SENATE BILL 562 (LARA) TO CREATE THE HEALTHY CALIFORNIA PROGRAM TO PROVIDE COMPREHENSIVE, UNIVERSAL, SINGLE-PAYER HEALTH CARE COVERAGE AND A HEALTH CARE COST CONTROL SYSTEM FOR THE BENEFIT OF ALL RESIDENTS OF THE STATE WHEREAS, every Californian should have a right to access affordable health care; and WHEREAS, while the federal Patient Protection and Affordable Care Act (PPACA) brought many improvements in health care and health care coverage, it still leaves many Californians without coverage or with inadequate coverage; and WHEREAS, Californians, as individuals, employers, and taxpayers have experienced a rise in the cost of health care and health care coverage in recent years, including rising premiums, deductibles, and copays, as well as restricted provider networks and high out-of-network charges; and WHEREAS, businesses have also experienced increases in the costs to provide health care benefits for their employees, and many employers are shifting a larger share of the cost of coverage to their employees or dropping coverage entirely; and WHEREAS, rising healthcare costs harm individuals, families, employers and communities, and, from the perspective of City Government, cause cuts in other vital services; and WHEREAS, in 2017, California constitutes the sixth largest economy in the world, and is therefore able to attempt to provide health care to every resident of the state; and WHEREAS, Senate Bill 562 (SB 562), passed by the Senate on June 1, 2017, proposes to create the Healthy California program to provide comprehensive, universal, single-payer health care coverage and a health care cost control system for the benefit of all residents of the state; and WHEREAS, SB 562 plans for Healthy California to cover a wide range of medical benefits and other services, and to incorporate the health care benefits and standards of other existing federal and state provisions; and WHEREAS, SB 562 plans for the participation of health care providers in Healthy California, and to require care coordination for members, provide for payment for health care services and specify program standards; and WHEREAS, SB 562 plans to create the Healthy California Trust Fund in the State Treasury, as a continuous appropriated fund, consisting of any federal and state moneys received for the purposes of the act; and WHEREAS, SB 562 plans to create the Healthy California Board to govern the program, made up of nine members with expertise in health care; and would also require the Secretary of Packet Pg 276 18 Resolution No. _____ (2017 Series) Page 2 R ______ California Health and Human Services to establish a public advisory committee to advise the Board on all matters of policy for the Healthy California program. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo that the City of San Luis Obispo supports the goal of SB 562 to provide comprehensive, universal, single-payer health care coverage and a health care cost control system for the benefit of all residents of the state of California; and BE IT FURTHER RESOLVED that the Mayor is directed to send a letter no later than 30 days after passage of this Resolution to the authors of SB 562, and to the State Legislators that represent the City of San Luis Obispo, transmitting this Resolution. Upon motion of _______________________, seconded by _______________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this _____ day of _____________________ 2017. ____________________________________ Mayor Heidi Harmon ATTEST: ____________________________________ Carrie Gallagher City Clerk Packet Pg 277 18 Resolution No. _____ (2017 Series) Page 3 R ______ APPROVED AS TO FORM: _____________________________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________, _________. ____________________________________ Carrie Gallagher City Clerk Packet Pg 278 18 SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2017 - 2018 Regular Session SB 562 (Lara) - The Healthy California Act Version: April 17, 2017 Policy Vote: HEALTH 5 - 2 Urgency: No Mandate: No Hearing Date: May 22, 2017 Consultant: Brendan McCarthy This bill meets the criteria for referral to the Suspense File. Bill Summary: SB 562 would create a universal, single-payer health care system in California. Fiscal Impact: The fiscal estimates below are subject to enormous uncertainty. Completely rebuilding the California health care system from a multi-payer system into a single payer, fee-for-service system would be an unprecedented change in a large health care market. There are numerous uncertainties about how enrollees, providers, employers, and the state would adapt to such a system. The projected costs and revenue needs for the proposed Program are as follows. For a discussion of the underlying assumptions, see Staff Comments below. Total annual costs of about $400 billion per year, including all covered health care services and administrative costs, at full enrollment. Existing federal, state, and local funding of about $200 billion could be available to offset a portion of the total program cost. About $200 billion in additional tax revenues would be needed to pay for the remainder of the total program cost. Assuming that this cost was raised through a new payroll tax (with no cap on wages subject to the tax), the additional payroll tax rate would be about 15% of earned income. It is important to note that the overall cost of those new tax revenues would be offset to a large degree by reduced spending on health care coverage by employers and employees. Although precise estimates of total spending for employer sponsored health insurance are not available, the best available information indicates that existing spending is between $100 and $150 billion per year. Therefore, total new spending required under the bill would be between $50 and $100 billion per year. Background: The health care system in the state is primarily based upon an employer- sponsored health insurance model (about 45% of the population), with a significant number of people covered by Medi-Cal (26%), Medicare (10%), the individual market (9%), and other federal coverage (2%). Currently, about 8% of the state’s population is uninsured. Of the 3 million Californians under age 65 who are uninsured, about 1.8 million are undocumented adults (who are not eligible for Medi-Cal or subsidized coverage through Covered California),about 550,000 are individuals who are eligible for Medi-Cal, but not Packet Pg 279 18 SB 562 (Lara) Page 2 of 8 enrolled, about 400,000 are individuals who are eligible for subsidized coverage through Covered California, but not enrolled, and about 550,000 are individuals who are not income-eligible for subsidies through Covered California. The delivery of health care services in the state varies widely. Some payers, such as Kaiser Permanente, operate fully integrated health maintenance organizations that accept financial risk from payers (typically private employers) and pay for all necessary health care services. On the other hand, most Medicare beneficiaries receive their health care services through a fee-for-service system in which enrolled providers bill Medicare for services provided with no financial risk to the provider and varying levels of care coordination between different providers. About 80% of individuals enrolled in Medi-Cal receive their health care from Medi-Cal managed care plans who bear most of the risk for enrollee health care costs, although the level of clinical integration varies between plans. In the United States, health care spending represents about 19% of gross domestic product. This is roughly twice the average level of spending in other developed countries. Of the total spending on health care, 32% is for hospital care, 27% is for physician and other professional services, 13% is for prescription drugs, 7% is for health insurance administration, and 5% is for capital investment. It is important to note however, that a significant portion of the nation’s spending on prescription drugs (particularly high cost drugs) takes place in hospitals or physicians’ offices, and is therefore not counted in the estimated 13% of spending that goes for prescription drugs. With regard to administrative costs, there are two important issues to note. First, the estimated cost of health insurance-related administration does not reflect the significant costs to providers to interact with health insurers. The costs to negotiate contracts with multiple payers and comply with differing administrative requirements are substantial. On the other hand, any health care system will have significant administrative costs, simply to manage enrollment and pay claims made by providers. For example, the administrative cost to operate the Medicare and Medi-Cal fee-for-service systems are about 6% per year. This is lower than the overall cost of health insurer administration, but still a substantial cost. Proposed Law: SB 562 would create a universal, single-payer health care system in California. Key provisions of the bill would: Establish the Healthy California Program, to be overseen by an appointed Board; Authorize the Board to establish a single-payer health care system; Prohibit health insurers or health care service plans from providing coverage for any service covered by the Program; Require the Board to develop plans for providing coverage for long-te rm care services, coverage for retirees who move out of California, providing coverage for existing retirees, and including the existing workers compensation system within the Program; Authorize unspecified funding for retraining of workers in the health insurance industry who would no longer be employed under the bill; Require collection of certain information from hospitals (but not other providers); Make every resident of the state eligible for the Program; Packet Pg 280 18 SB 562 (Lara) Page 3 of 8 Prohibit any cost sharing for enrollees such as premiums, copayments, or deductibles; Require coverage for “all medical care determined to be medically appropriate by the member’s health care provider”; Also require coverage for all health care services covered by Medi-Cal, Medicare, health plans regulated under the Knox-Keene Act, and the essential health benefits mandated in the Affordable Care Act; Authorize any licensed health care provider to provide services to a member; Authorize members to receive health care services from any willing provider, without needing a referral from a primary care provider or a care coordinator; Require care coordination services to be provided to members; Prohibit care coordination administrative tracking and recordkeeping from requiring the utilization of electronic health records by providers; Require payments to providers to be made on a fee-for-service basis unless other payment methodologies are developed by the Board; Require all payments to be reasonable and reasonably related to the cost of providing health care services and to ensure an adequate supply of services; Authorize integrated health care delivery systems to choose to be compensated on a capitated or non-capitated system budget; Require the Program to negotiate payment rates with providers’ representati ves; Prohibit payments to for-profit providers or care coordinators to compensate for profits, return on investments, or tax payments made by the provider or care coordinator; Require the Board to apply to the federal government for permission to include the participants and funding streams for Medicare, Medi-Cal, and Covered California in the Program; State legislative intent to develop a financing plan; Authorize providers to collectively negotiate payment rates with the Board. Related Legislation: There have been several bills introduced in recent years attempting to create a single-payer system in the state, including SB 810 (Leno, 2011), SB 180 (Leno, 2009), and SB 840 (Kuehl, 2007). None of those bills were enacted. Staff Comments: As noted above, this bill would require unprecedented changes to a mature health care system. Therefore, there is tremendous uncertainty in how such a system would be developed, how the transition to the new system would occur, and how participants in the new system would behave. The following are some of the key underlying assumptions for the fiscal estimates above. The system is a fee-for-service health care market. The bill would require all payment rates under the program to be “reasonable and reasonably related to the cost…” and require all payments to be made on a fee-for-service basis unless and until another payment methodology is adopted by the Board. While the bill would allow for other forms of payment, the basic requirement in the bill that payments be cost-based and requirements in the bill that patients are able to see any willing provider of services would make it difficult for the Board to create capitated payment systems that would work under those constraints. Packet Pg 281 18 SB 562 (Lara) Page 4 of 8 Health care utilization levels and administrative costs are based on the existing Medi- Cal fee-for-service system. The state currently operates the Medi-Cal fee-for-service system which provides services to about 2.7 million people in the state, with a variety of beneficiary types served through fee-for-service. This analysis builds upon the costs and utilization for the Medi-Cal fee-for-service system (with adjustments). There are factors that make fee-for-service Medi-Cal an imperfect model for a state-wide single payer system. For example Medi-Cal beneficiaries, on average, tend to have lower health status than the general population. This would indicate that utilization of services may be lower for a state-wide program. On the other hand, low reimbursement rates in Medi-Cal are likely to constrain the ability for beneficiaries to access service, to some extent. On balance, using the Medi-Cal fee-for-service system as the base for modelling a single-payer system seems to be a reasonable assumption. There is likely to be increased utilization of health care services over fee-for-service Medi-Cal. Under the bill, enrollee access to services would be largely unconstrained by utilization management tools commonly used by health care payers, including Medi-Cal. The ability for enrollees to see any willing provider, to receive any service deemed medically appropriate by a licensed provider, and the lack of cost sharing, in combination, would make it difficult for the Program to make use of utilization management tools such as drug formularies, prior authorization requirements, or other utilization management tools. Therefore, it is very likely that there would be increased utilization of health care services under this bill, compared to fee-for-service Medi-Cal, Medi-Cal managed care, or the current employer sponsored health insurance system. Therefore, this analysis assumes a 10% increase in health care service utilization over fee-for-service Medi-Cal. Given all the factors that would make utilization management difficult, a 10% utilization increase is likely a conservative assumption. Provider rates are based upon the rates paid by Medicare . Medi-Cal fee-for-service rates are very low, compared to Medicare or commercial insurance reimbursement rates. Under current practice, providers such as physicians and hospitals rely on Medicare and commercial insurance to subsidize the cost to care for Medi-Cal patients. There seems to be consensus that Medicare rates are close to the cost of providing care. This analysis assumes that the Program would need to pay reimbursement rates close to Medicare rates to ensure continued access to services. Most state residents are included in the program . The analysis assumes that the state is able to enroll most residents, including those currently covered under Medicare, Medi- Cal, coverage purchased through Covered California, employer sponsored insurance, and the uninsured population. This assumes that the state is successful in obtaining federal approval to enroll participants in federally authorized programs and employer- sponsored insurance regulated at the federal level. The analysis excludes certain federal health care programs for federal employees, military personnel, and veterans. Most existing state and local funding sources for health care program are made available for the program . This reflects the assumption that the federal government would allow the state to combine federal funding sources with state resources to finance the program. In addition, it assumes that the necessary state law and constitutiona l changes are made to make most existing state and local funding for health care programs available to finance the program. Packet Pg 282 18 SB 562 (Lara) Page 5 of 8 Costs are presented in 2017 dollars although full implementation would likely take many years. The following are some of the key implementation issues the state would face in creating a single-payer system. How long would it take for the state to implement the system? In order to effectively manage the single-payer system envisioned in the bill, the state would need to develop systems to track member enrollment, track provider enrollment, and pay claims to providers. Development of the information technology systems to perform those functions at the scale envisioned in this bill would be a substantial undertaking. For example, the state is in the process of preparing to replace the existing system for paying Medi-Cal fee-for-service claims (for about one tenth the enrollees that would be covered under the bill). That project was started in 2007. In 2016, the Department of Health Care Services severed its agreement with its contractor and is about to begin the process of procuring a new contractor to restart the project. Because the bill would include coverage for Medicare and Medi-Cal enrollees, any claims processing system developed by the state would probably need to be able to track whether a member is eligible for either of those programs, in order to ensure that the state can access federal matching funds. (This would only be necessary if federal funding continued to be provided as matching funds for state funding.) The costs to design, develop, and implement the information technology systems to facilitate the operation of the program alone are likely to be in the billions. How would the state manage the transition? It would likely take many years to fully implement the system envisioned in the bill. It is difficult to foresee how health care markets would react as the operational date approaches. For example, would health insurers and health plans be able to retain enough employees or make necessary investments in their systems to remain viable up to the transition time? Also, as the prospect of comprehensive health care coverage with no cost sharing by members approaches, would young and health consumers drop their existing coverage, knowing that they would soon be able to receive services at no cost? In the transition to a single-payer system, essentially all workers in the health insurance industry and many individuals who provide administrative support to providers would lose their jobs. The ability for a very large number of workers to successfully find new employment over the short-term is hard to predict. (Even with job retraining programs authorized in the bill.) Predicting the labor market effects the sudden elimination of a significant industry in the state is beyond the scope of this analysis. Would the federal government cooperate? Under current law, the federal Centers for Medicare and Medicaid Services is authorized to waive certain requirements of the Social Security Act, which governs both Medicare and Medicaid . The federal governments grants “waivers” to a state so that the state can make innovative changes to is Medicaid program. Generally, a waiver must improve health care access or delivery and not increase the federal deficit over the waiver’s lifetime. Currently, the state has a number of waivers in place, governing many aspects of the Medi-Cal program. In theory, the federal government could give the state a waiver to allow the state to incorporate Medicare, Medi-Cal, and Covered California subsidies into a single Packet Pg 283 18 SB 562 (Lara) Page 6 of 8 state program, provided that it met the above requirements. However, there is nothing in federal law that requires a waiver to be granted to a state; it is completely discretionary for the federal government. Many large employers in the state are self-insured, in that the employer retains the risk for the costs of providing health care to employees. Self-insured employers are regulated under the federal Employment Retirement Income Security Act (ERISA). About 3.7 million Californians receive health care coverage under ERISA plans that are not subject to state regulation. In order for the state to include those individuals in the Program, a change would likely be needed to federal law. Implementation of the bill would require approval by the voters. There are several provisions of the state constitution that would prevent the Legislature from creating the single-payer system envisioned in the bill without voter approval. Article XIII B (often referred to as the “Gann Limit”) constrains overall state spending growth based on population growth and inflation. Due to subsequent changes made by the voters, the Gann Limit has not fundamentally constrained state spending since the 1980s. However, the very large tax revenues that this bill would require (almost twice current General Fund revenue) would clearly exceed the Gann Limit. Therefore, to successfully implement the bill, the voters would need to amend the state constitution to either repeal the Gann Limit or exempt the taxes to fund the Program from the Gann Limit. Article XVI, Section 8 (Proposition 98 of 1988) generally requires the state to make payments for K-14 education equal to about 50% of annual General Fund revenues. (The actual funding formulas for Proposition 98 are complex and vary from year to year based on economic conditions and state budgeting.) In the context of Proposition 98, the term “General Fund” revenue refers to state tax revenues, not simply revenues that are deposited in the state’s General Fund. Any taxes raised to support this bill would be considered the proceeds of taxes and would be subject to the requirements of Proposition 98. Since it would be infeasible to dedicate one-half of the new revenues for this program to education (or to raise twice the amount needed for the bill), the voters would need to exempt the tax revenues generated to fund this bill from the requirements of Proposition 98. Article XIII, Section 36 (Proposition 30 of 2012) guarantees that certain tax revenues will be provided to counties to pay for services relating to public safety that were realigned to the counties in 2011. Included in the 2011 realignment is funding for certain mental health services and substance abuse services. In order for those funds to be available to contribute to the financing of the Program, the Constitution would need to be amended. There would be limited ability for the state to control costs under the bill. In general, there are two ways to control health care spending – controlling utilization of services or controlling costs. In theory, having a single, statewide payer for health care services could create significant bargaining power for that payer to manage utilization and/or control costs. A single payer could be in a very strong negotiating position with health care providers such as doctors, hospitals, and drug manufacturers. However, the single- payer system envisioned in this bill strongly limits the state’s ability to control costs. Packet Pg 284 18 SB 562 (Lara) Page 7 of 8 With respect to utilization of health care services – First, the bill would provide coverage for all medical care “determined to be medically appropriate by the member’s health care provider”. This broad language would allow health care providers to determine what services they are going to provide, without any ability for the Program to set standards or guidelines for providing services. This would seem to prohibit tools such as prior authorization requirements, drug formularies, or other utilization management tools. Second, the bill would make any licensed health care provider eligible to perform services, which means that the state could not use potential exclusion from the system as a means of negotiating favorable prices, as health insurers often do. Third, the bill would prohibit members from needing a referral before seeing a provider (such as a specialist). This would prevent the Program from ensuring that utilization of expensive specialty care is appropriate. With respect to health care prices – The bill would constrain the Program’s ability to negotiate prices with providers, since it would require all payments to be reasonably related to the cost of providing care. Requiring providers to be paid based on their cost of providing care is likely to lead to increased inflation in costs, since providers would have little incentive to control costs through increased efficiency. In addition, the ability to negotiate favorable prices for health care services does not necessarily mean that such authority would be used effectively. In practice, any attempt by the state to negotiate favorable prices would be strenuously resisted by health care providers and drug companies. The federal Medicare program is a case in point. Medicare is essentially a single-payer system with about 55 million enrollees. In theory, this should provide Medicare with significant power to bargain favorable prices for services. In practice, the rates that Medicare pays to providers are similar to those paid in the commercial market and are generally thought to correspond to the cost of providing care. Medicare has not been able to successfully use its bargaining power to “bend the cost curve” on health care prices. Further, federal law actually prohibits Medicare from using its bargaining power to secure favorable drug prices. A state- based single payer system would be subject to the same political constraints as Medicare. In addition, it is possible that the federal government would restrict the state’s ability to negotiate favorable drug prices, either as a condition of a waiver or through a federal law change. Administrative cost savings would be real, but limited. Under a single payer system, the overall administrative cost of the system would likely be lower than it is in the current multi-payer system. In the United States, the cost of the health insurance industry is about 7% of total costs. In addition, providers, such as hospitals and physicians, incur significant administrative costs to negotiate contracts and comply with health insurer billing requirements. If we assume that the costs on the provider side are equal to the costs of the insurance industry, then current administrative costs are likely to be about 15% of total spending. Administrative costs in the Medi-Cal fee-for-service system and Medicare are about 6% of spending. Assuming that dealing with a single payer system reduced provider administrative costs by half, total administrative costs of the system in the bill would likely be about 9-10% of total spending. This does represent a significant savings in a $400 billion health care system. However, administrative savings are not likely to substantially lower the overall cost of providing health care in the state, compared to costs associated with expanding coverage to the uninsured and increased utilization of services under the bill. Packet Pg 285 18 SB 562 (Lara) Page 8 of 8 How would Medicare and Medi-Cal funding be provided to the Program? If the federal government were to approve a state waiver request to include funding for Medicare and Medi-Cal into the Program, there are two primary ways that could be done, with myriad variations. The federal government could simply allow the state to provide coverage for those populations and draw down federal matching funds for services provided to those populations. This would represent the entire cost for Medicare beneficiaries and varying levels of federal matching funds for Medi-Cal beneficiaries based on their eligibility. This would represent a status quo in terms of payment systems, from the federal government’s perspective. It would have the advantage that the state would not need to accept any new risk for providing coverage for those populations, but it would require the state to develop an information technology system that could accurately track spending on those populations to receive federal matching funds. Alternatively, the federal government could impose some sort of a “per capita funding” system or a “block grant” system, in which the state either received a fixed amount of funding for each enrolled individual or an overall amount of funding for the program. This would somewhat simplify the state’s administrative obligations. On the other hand, the state would likely face risk for increased in utilization levels or costs. Since no state has ever implemented a single-payer system, it is difficult to know what requirements the federal government would place on the state to allow Medicare and Medi-Cal to be included. The economic impact from the necessary tax increases is unknown. This analysis assumes that the state would impose a roughly 15% payroll tax to finance the unfunded cost of the Program. Such a payroll tax would raise about $200 billion per year. Because the bill would relieve employers of the responsibility for providing employer sponsored insurance, employers would see a reduction in their costs. In the long-run, it is likely that employers would increase wages to employees, so that total compensation would be roughly equivalent to what it was when employers were paying for employee health benefits. How this would play out in reality would depend on the labor market dynamics in place at the time. For example, in a recession when unemployment is high, employers may be under less labor market pressure to pass cost savings along to employers. The opposite effect could be seen in a very competitive labor market. Even after accounting for the fact that employers would see a reduction in their costs for providing employer-sponsored insurance, the bill would result in a significant overall increase in the cost of health care for employees. Under the staff estimates above, the gap between current employer spending on health insurance and the additional revenue needs under the bill would be between $50 and $100 billion per year. The cost of that funding gap would fall on employees under a payroll tax. That means that between 25% and 50% of the payroll tax revenues would represent a new tax on employees, not likely to be offset by higher wages. The state-wide economic impacts of such an overall tax increase on employment is beyond the scope of this analysis. -- END -- Packet Pg 286 18