The URL can be used to link to this page

Home My WebLink About6/2/2020 City Council PresentationsCity Council Regular Meeting June 2, 2020 Webinar Information: Registration URL: https://attendee.gotowebinar.com/register/866540913566551052 Webinar ID: 140-398-763 Audio access by phone: : (415) 655 -0060; Audio Access Code: 900-352-974 Public Comment: •Verbal Public Comment ➢Participants of the webinar can provide Public Comment by: •Submitting a ‘question’that includes their name and item number (or public comment)for the item they would like to speak on. •Once public comment for the item is called,your microphone will be unmuted.You will have three minutes to speak. •Email Public Comment ➢Comments up to one page can be emailed to cityclerk@slocity.org.Please indicate the item number.Comments will be read aloud during the public comment period for the item specified. PUBLIC COMMENT FOR ITEMS ON THE AGENDA ONLY Public Comment: •Verbal Public Comment ➢Participants of the webinar: •Submit a ‘question’that includes their name and item number (or public comment)for the item they would like to speak on. •Once public comment for the item is called,your microphone will be unmuted and you will have three minutes to speak. •Use the “Raise Hand”icon •Email Public Comment ➢Comments up to one page can be emailed to cityclerk@slocity.org.Please indicate the item number.Comments will then be read aloud during the public comment period for the item specified. Item #1 -10 CONSENT AGENDA Matters appearing on the Consent Calendar are expected to be non-controversial and will be acted upon at one time.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. 11.2019-21 Financial Plan Supplement and 2020-21 Budget Item #11 PUBLIC HEARING ITEM Staff Presentation By: Brigitte Elke, Finance Director Natalie Harnett, Budget Analyst 2019-21 Financial Plan 20-21 Supplemental Budget June 2, 2020 5 Recommendations 1.Adopt a resolution (Attachment A)establishing the City’s appropriation limit for 2020-21 in compliance with Article XIII B of the State Constitutions, Gann Spending Limitation. 2.Review and approve the 2019-21 Financial Plan Supplement and 2020-21 Budget and approve a resolution (Attachment C)to: a)Appropriate the budget for fiscal year 2020-21 b)Authorize the Utilities Director to defer approved water and sewer rate increases for 2020-21 to be reconsidered in October 2020. c)Approve suspending Class 1 and Class 2 industrial user permit fees in 2020-21 d)Approve increases to the City’s fee schedule for 2020-21 (Attachment D). e)Authorize the City Manager to adopt and implement a limited duration Voluntary Retirement Incentive Program (VRIP) (Attachment E) through December 2,2020 subject to meet and confer requirements. 3. Adopt resolution (Attachment F)to defer future parking rate increases and introduce an ordinance (Attachment G)deferring said increases. 6 City Manager Message •First and foremost: the health of our community •2019-20 was a year of significant accomplishments and historical challenges •Budget Supplement Process –Normally compared to “today” •Preparation for fiscal challenges ahead •Changes to Major City Goals and Work Programs •Presentation of a balanced budget •Hopeful outlook and a mindset on teamwork, innovation, problem solving! Setting the stage Strategic Planning General Fund Enterprise Funds CIP 7 Other Agenda Items 8FACTORS AND PHASES OF RECOVERY Setting the stage Strategic Planning General Fund Enterprise Funds CIP We are here Other Agenda Items 9TIMELY AND ACCURATE COMMUNICATION MUST CONTINUE Setting the stage Strategic Planning General Fund Enterprise Funds CIP Other Agenda Items Why at Meta Goal? Thriving City/Region Improved Quality of Life Attracts Community Co- creators (people) Creates Economic Opportunities Generates Economic Activity Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 10 2020-21 Timeline Revised 2020-21 Financial Plan Financial Plan 19-21 Five MCG’s. COVID-19 Economic & Financial Impacts Economic Recovery and Resiliency Meta MCG October Revise 2020-21 Next Steps Scenario Modeling Re-forecasting Actualizing 19-20 Focus on economic recovery Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 11 41%Major City Goals Completed or Implemented 2019-20: Many Milestones to Acknowledge 20CIP Projects Completed or being Finalized ▪Launch of Monterey Bay Community Power for San Luis Obispo ▪Miossi Open Space Conservation Plan ▪Affordable Housing Nexus Study ▪Pickleball Courts and Basketball Court ▪Online Police Reporting ▪Water Energy Efficiency Project ▪Water Resource Recovery Facility Update ▪And many more… Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 12 Fiscal Health Response Plan: Three-year program to balance the long-term forecast and to begin an aggressive schedule to pay down pension obligation. 2019-20 Results: Realized savings from additional contributions to CalPERS and hiring new staff under the PEPRA retirement plan. * From 2018-19 Fund Balance $6.0 million One-time money in undesignated fund balance as of June 2019. Retain for anticipated revenue shortfalls and economic recovery. Re-visit in October 2020 Fiscal Health Response Plan Coming to Fruition Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 13 Assumptions Shelter in place until 5/31/20 Phased reopening Schools return in Fall 2020 Impact on most industries Recessionary trends “U” Shaped recovery “How much of a guessing game is a wild guessing game right now as there is no historical precedent for the current crisis and little good data as of yet.” –Beacon Economics General Fund Long Term Forecast Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 14 Adopted Budget* Projected Year End Variance + Total Revenues $77,337 $71,588 ($5,749) -Total Expenditure $75,697 $72,937 ($2,760) Revenue Over/(Under) Expenses $1,640 ($1,348) *For detailed budget data see pg. 62 Originally forecasted to be used for one-time CalPERs payment Rough estimate based on revenue projections and expenditure reductions associated with Fiscal Health Contingency Plan One-time money available from FY 18-19 fund balance to cover shortfall if needed. True year end actuals not available until August 2020. 2019-20 General Fund Year End Projections Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 15 Fiscal Health Contingency Plan Activated –Hiring, purchasing, and travel chills to mitigate revenue shortfalls. Active Scenario Models –Allow the City to address budgetary shortfalls quickly and nimbly. Healthy Reserve Levels –The City has multiple reserves in preparation for future unknowns and maintenance of cash flow. General Fund Reserve Levels FY20 20% Operating Reserve $11 million Revenue Stabilization $1 million Section 115 Trust Fund Allocation $1.4 million Undesignated Funds $6 million Local Revenue Measure Reserve $1.5 million TOTAL $20.9 million Where are we now? Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 16 Freeze Operating Budgets at 2019- 20 Levels Re-work Major City Goals Re-prioritize Capital Improvement Plan Projects Retirement Incentives 2020-21 Budget Strategy for a Balanced Budget Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 17 Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 18Introduction of ONE Unified City Goal: Economic Stability,Recovery,and Resiliency Why concentrate on ONE goal? Collaborative organization and community focused on outcomes Strength in Team is a Working Agreement and Core Value Teams are most effective when they have a Shared Vision Maximize and Prioritize Strategies to achieve focused goal Allows staff to provide essential services and reopen City operations and facilities with focus on community outcomes Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 19 See packet page 33 for tactical examples 10 Strategies that Connect to 2019-21 Major City Goals Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 20 $70.26 $69.57 $8.62 $5.85 Revenues Expenditures Shortfall Reduction Balanced Budget Revised Budget Original Budget $78.89 Original Budget $75.41 Revised Budget 2020-21: Proposed General Fund Overview Expenditure Reductions Staffing $2.96 m Insurance Expenses $1.06 m CIP $1.76 m Other $0.07 m TOTAL $5.85 Revenue Shortfalls Sales Tax $3.41 m Transient Occupancy Tax $1.87 m Other Taxes $2.03 m Fees for Service $1.31 m TOTAL $8.62 Budget Changes due to COVID19 (in millions) Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 21 General Fund: Changes in Financial Position Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 22 Table E6-2 General Fund Revenues 18-19 Actual 19-20 Budget FY 20-21 Original Budget FY 20-21 Revised Budget Change % Change Tax & Franchise Revenue 60,956,000 62,291,502 65,097,000 57,782,426 (7,314,574) -11% 1 Sales Tax (incl. LRM)26,444,000 25,900,000 26,266,000 22,853,783 (3,412,217) -13% 2 Property Tax 17,473,000 17,940,101 18,637,000 18,298,903 (338,097) -2% 3 Transient Occupancy Tax 8,061,000 8,033,001 8,133,000 6,267,000 (1,866,000) -23% 4 Utility User Tax 4,920,000 5,854,000 5,971,000 5,565,000 (406,000) -7% 5 Business Tax Certificates 2,630,000 2,942,000 3,001,000 2,853,740 (147,260) -5% 6 Franchise Fees 1,428,000 1,558,000 1,589,000 1,544,000 (45,000) -3% 7 Cannabis Tax 64,400 1,500,000 400,000 (1,100,000) -73% Fees for Service 13,023,674 15,221,607 13,788,821 12,478,725 (1,310,096) -10% 8 Development Review 5,881,785 6,963,000 5,426,000 5,722,000 296,000 5% 9 Parks & Recreation 1,871,996 1,762,929 1,794,503 1,390,240 (404,263) -23% 10 Police Services 655,371 605,347 745,602 593,350 (152,252) -20% 11 Fire Services 1,453,435 1,416,913 1,413,942 1,327,676 (86,266) -6% 12 General Government 521,893 435,418 444,015 439,215 (4,800) -1% 13 Cannabis 225,000 100,000 750,000 320,937 (429,063) -57% 14 Grants and Subventions 1,098,145 900,000 900,000 900,000 - 0% 15 Other Revenues 1,316,049 3,038,000 2,314,759 1,785,307 (529,452) -23% Grand Total 73,979,674$ 77,513,109$ $ 78,885,821 $ 70,261,151 (8,624,670)$ -11% 19-21 Financial Plan Use of Funds Staffing 53,539$ 50,861$ 55,113$ 53,190$ (1,923)$ -3% Contract Services 6,558$ 5,319$ 5,434$ 5,050$ (384)$ -7% Other Operating Expenditures 10,299$ 6,523$ 6,251$ 7,688$ 1,437$ 23% Cost Allocation (3,982)$ (4,281)$ (4,367)$ (4,578)$ (212)$ 5% SOBCs 2,175$ 2,001$ (2,001)$ -100% Total Operating Expenditure $ 66,414 $ 60,597 $ 64,433 $ 60,812 $ (3,620)-6% Debt Service 2,784$ 2,716$ 2,577$ 2,759$ 182$ 7% Capital Expenditures 6,049$ 9,288$ 7,693$ 5,934$ (1,759)$ -23% General CIP 934$ 521$ 256$ (265)$ -51% SB1 818$ 1,325$ 796$ (529)$ -40% LRM CIP 3,642$ 3,698$ 3,104$ (594)$ -16% Fleet 593$ 602$ 260$ (342)$ -57% IT infrastructure 885$ 904$ 979$ 75$ 8% Major Facility Replacements 516$ 524$ 420$ (104)$ -20% Infrastructure Investment Fund 1,900$ 119$ 119$ -$ 0% Transfers (1,241)$ 336$ 709$ 61$ (648)$ -91% Total Expenditure $ 74,006 $ 72,937 $ 75,412 $ 69,566 $ (5,845)-8% Table E6-2 General Fund Revenues 18-19 Actual 19-20 Budget FY 20-21 Original Budget FY 20-21 Revised Budget Change % Change Tax & Franchise Revenue 60,956,000 62,291,502 65,097,000 57,782,426 (7,314,574) -11% 1 Sales Tax (incl. LRM)26,444,000 25,900,000 26,266,000 22,853,783 (3,412,217) -13% 2 Property Tax 17,473,000 17,940,101 18,637,000 18,298,903 (338,097) -2% 3 Transient Occupancy Tax 8,061,000 8,033,001 8,133,000 6,267,000 (1,866,000) -23% 4 Utility User Tax 4,920,000 5,854,000 5,971,000 5,565,000 (406,000) -7% 5 Business Tax Certificates 2,630,000 2,942,000 3,001,000 2,853,740 (147,260) -5% 6 Franchise Fees 1,428,000 1,558,000 1,589,000 1,544,000 (45,000) -3% 7 Cannabis Tax 64,400 1,500,000 400,000 (1,100,000) -73% Fees for Service 13,023,674 15,221,607 13,788,821 12,478,725 (1,310,096) -10% 8 Development Review 5,881,785 6,963,000 5,426,000 5,722,000 296,000 5% 9 Parks & Recreation 1,871,996 1,762,929 1,794,503 1,390,240 (404,263) -23% 10 Police Services 655,371 605,347 745,602 593,350 (152,252) -20% 11 Fire Services 1,453,435 1,416,913 1,413,942 1,327,676 (86,266) -6% 12 General Government 521,893 435,418 444,015 439,215 (4,800) -1% 13 Cannabis 225,000 100,000 750,000 320,937 (429,063) -57% 14 Grants and Subventions 1,098,145 900,000 900,000 900,000 - 0% 15 Other Revenues 1,316,049 3,038,000 2,314,759 1,785,307 (529,452) -23% Grand Total 73,979,674$ 77,513,109$ $ 78,885,821 $ 70,261,151 (8,624,670)$ -11% 19-21 Financial Plan Water and Sewer Funds: Overview Impacts from COVID19 Largely unknown effect on consumption •Cal Poly-modified matriculation and instruction schedule(s) •Closed/modified businesses •Increased residential usage •Unpaid bills Estimated Revenue Reduction Water: -$2.1 m Sewer: -$1.4 m In an effort to support economic recovery, the Utilities department is proposing Defer rate increases originally scheduled in 2020-21 Suspend industrial user Class 1 & Class 2 industrial user permit fees Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 23 Water Fund: Changes in Financial Position Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 24 Sewer Fund: Changes in Financial Position Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 25 Utilities: Significant Operating Budget Changes Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 26 •Liquid Oxygen for the new Ozone System at the Water Treatment Plant. •Moving Stormwater responsibilities from the Water Resources Program Manager to the Environmental Programs Manger. •Digsmart to manage Underground Service Alerts. •Permanently create the Solid Waste Coordinator position. •Fund the Interim-Deputy Director for another year to manage the WRRF upgrade project. Parking Fund Highlights Anticipated revenue shortfall of approximately $2.6M in 2019-20 and $3.3M in 2020-21. Complete final design for the Palm-Nipomo parking structure to be “shovel ready”BUT will not program the start of construction until the Fund is sufficiently stabilized from the COVID-19 impacts. Maintain the minimum 20%operating reserve level as well as cover all current debt obligations. Key role in economic recovery. Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items $2,750 $3,292 $50 $1,050 $2,050 $3,050 $4,050 $5,050 $6,050 $7,050 Revised Projection Shortfall Original Budget $6,042 Revenue Shortfalls Deferred Rate Increase -$727 Reduced Enforcement -$334 Waived Metered Parking -$1,104 Reduced Structure Usage -$772 Other Shortfalls -$357 TOTAL -$3,292 2020-21 Parking Revenues (thousands) Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 28Parking Fund: A look at financials Revenue shortfalls offset by operating reductions and use of unreserved working capital. Current unreserved working capital = Approx. $12.2 million Parking Fund Expenditure Budget Changes * Graph does not include Palm-Nipomo Parking Structure: •$29 million CIP project postponed •$20 million in debt financing postponed Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 29 $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 2017-18 Actual 2018-19 Actual 2019-20 Projected 2020-21 Revised 2021-22 Budget 2022-23 Budget 2023-24 Budget 2024-25 Budget Parking Revenues and Expenditures FY18 -FY25 Revenues Expenditures Financial Plan Years Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items Parking Fund: Recovery & Path Forward Economic Recovery Efforts Deferred rate increases. Waived parking fees for meters and structures until usage returns to pre-COVID occupancies levels. Establishment of almost 30 Curbside pick-up zones FREE structure validations for customers when hourly rates are re-established. Community outreach and business partnerships The Path Forward Investment in NEW technology: mobile apps, gateless parking Parking ambassadors to improve communication Increased use of the Automated License Plate Recognition (ALPR) technology to improve enforcement coverage and customer permitting Transit Fund Expenditure Budget Changes •Significant decrease in ridership (assumed 50% for FY 2020-21) •Changes to operations –hours, Cal Poly services, community assistance •Funding through CARES Act to fully offset revenue shortfalls and operational costs for FY20 and FY21 In thousands Original FY21 Revised FY21 Variance Revenues $4,188 $4,182 -$6 Expenditures $4,164 $3,670 -$494 Working Capital $2,829 $3,489 $660 Unreserved Working Capital $1,945 $2,225 $280 * For detailed budget changes see pg. 112-120 Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 31 Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 32Capital Project Prioritization Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 33Capital Project Prioritization CIP Deferrals and New/Supplemental Funded Projects 243 CIP Projects $207.8M Deferred CIP Projects 45 Projects, e.g.: -Laguna Lake Dredging -Fleet Replacements -Farmer’s Market Bollards -Sinsheimer Stadium Irrigation and Drainage Replacements Continuing FY19/21 CIP Projects New/ Supplemental CIP Funding 27 Projects, e.g.: -Downtown Parklets -Downtown Banner Arms and Signage -Ped Crosswalk Beacons and Safety Improvements -Bike/Ped Quick Builds -Orcutt/Tank Farm Roundabout Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 34Capital Improvement Plan (CIP) Net Changes by Fund ID#Fund Number of Projected Budget Number of Projects Budget % change (Budget) 1 Capital Outlay 52 8,707,762$ 42 7,416,143$ -15% 2 LRM 102 17,101,672$ 86 15,256,379$ -11% 3 Parking 17 5,856,602$ 12 5,000,102$ -15% 4 Transit 6 565,121$ 7 1,095,549$ 94% 5 Water 39 32,349,508$ 38 33,001,950$ 2% 6 Sewer 34 133,712,483$ 38 134,688,483$ 1% 7 SB1 2 1,325,000$ 3 795,548$ -40% 8 Transportation Impact Fee 20 9,801,808$ 17 10,617,690$ 8% TOTAL 272 209,419,956$ 243 207,871,844$ -1% Planned Revised Setting the stage Strategic Planning General Fund Enterprise Funds CIP Agenda Items 35Capital Improvement Plan (CIP) Completed / Upcoming Projects $9.2 Million Completed CIP 20 Projects •South Broad Street Paving •Waterline Replacements •Sewerline Replacements •Downtown Renewal •Meadow Park Pedestrian Bridge Replacements •Council Audio / Video Replacement •Pickleball Courts •El Capitan Bridge Replacement •Creek Silt Removal •Swim Center Pool Re-plaster •Mission Plaza Security Cameras •Fire Station Emergency Backup Generator •HVAC Replacements •City Facility Painting Projects $15.5 Million Ongoing / Upcoming CIP 13 Projects •Waterline Replacements at Casa/Murray •South Hills Radio Site Upgrades •Marsh Street Bridge Replacement •Islay Hill Park Playground Replacements •Bridge Maintenance •City Facility HVAC Replacements •Roadway Sealing 2020 & Parking Lot Maintenance •Swim Center Roofing Repair •Bullock CMP Replacement •Railroad Safety Trail –Taft to Pepper The amount subject to appropriation for fiscal year 2020 -21 is $48 million, or about $27 million under the appropriation limit set forth below: Attachment A –Pg. 10 •Based on the Gann Spending Limit Initiative, a State constitutional amendment adopted by the voters in 1979 and amended in 1990 with Proposition 111. •Under its provisions, no local agency can appropriate proceeds in excess of its “appropriation limit” Setting the stage Strategic Planning General Fund Enterprise Funds CIP Other Agenda Items 362020-21 Appropriation Limit Purpose and Need: 1 Achieve cost savings through reduced salary and benefit costs in response to ongoing fiscal challenges 2 Restructure positions to focus on changing priorities, needs, and/or strategic objectives. 3 Increase organizational efficiency through thoughtful reorganization (Attachment E –Pg. 213) Setting the stage Strategic Planning General Fund Enterprise Funds CIP Other Agenda Items 37Voluntary Retirement Incentive Program •Fee assessment study performed every five years to ensure up-to-date cost recovery levels. •Most fees updated annually by CPI for Los - Angeles-Riverside area.2020-21 CPI = 0.7% •Impact Fees use the Construction Cost Index •2020-21 Fees include the cost to the City of credit card charges (~$200k per year). Setting the stage Strategic Planning General Fund Enterprise Funds CIP Other Agenda Items 382020-21 Fee Schedule Update Conclusion Creation of Meta City Goal Parking Incentives & Ordinance Changes Deferred rate increases Maintain service levels with plan for October budget revise Suspension of industrial user permit fees (C1 &C2) Re-prioritization of Capital Improvement Programs 26 The City is proud to present a balanced 2020 -21 budget and a focus on supporting economic recovery for our local community The City of San Luis Obispo continues to be well positioned to deliver the kind of resilient, dynamic, and sustainable community we all aspire to live in and is in the heart and soul of our community. City Manager Derek Johnson Recommendations 1.Adopt a resolution (Attachment A)establishing the City’s appropriation limit for 2020-21 in compliance with Article XIII B of the State Constitutions, Gann Spending Limitation. 2.Review and approve the 2019-21 Financial Plan Supplement and 2020-21 Budget and approve a resolution (Attachment C)to: a)Appropriate the budget for fiscal year 2020-21 b)Authorize the Utilities Director to defer approved water and sewer rate increases for 2020-21 to be reconsidered in October 2020. c)Approve suspending Class 1 and Class 2 industrial user permit fees in 2020-21 d)Approve increases to the City’s fee schedule for 2020-21 (Attachment D). e)Authorize the City Manager to adopt and implement a limited duration Voluntary Retirement Incentive Program (VRIP) (Attachment E) through December 2,2020 subject to meet and confer requirements. 3. Adopt resolution (Attachment F)to defer future parking rate increases and introduce an ordinance (Attachment G)deferring said increases. 40 Item #12 PUBLIC HEARING ITEM 12.Review of an Appeal (filed by San Luis Architectural Protection)of the Planning Commission’s decision to approve a four- story Mixed-Use Project (545 Higuera Street, 486 Marsh Street,ARCH-0017-2019) Staff Presentation By: Michael Codron, Community Development Director Shawna Scott, Senior Planner 545 Higuera / 486 Marsh APPL-0201-2020 Appeal of a four-story mixed-use project consisting of 5,241 square feet of ground-floor commercial, 8 hotel suites, and 39 residential units, including a mechanical lift and fourth floor roof deck, with a categorical exemption from environmental review June 2, 2020 Applicant: Taylor Judkins, G3 Concepts Representative: Jessie Skidmore, TenOver Studio Recommendation and Purview 43 Recommendation: Adopt a resolution (Attachment A) denying the appeal and upholding the Planning Commission’s approval of the project. Project Site –Two parcels (0.79 acre) Downtown Commercial Zone 44 Project Site Surrounding Uses 45 Pollard House Norcross House Project Description 46 •2,043 sf of retail space (Marsh Street) •5 studio units (447 to 629 sf) •14 one-bedroom units (700 to 807 sf) •8 two-bedroom units (798 to 1,174 sf) •Wrap-around walkways and decks, private balconies •705-square foot roof deck on the fourth floor; private balconies •Enclosed garage & three-level mechanical parking lift •3,198 sf of retail space (Higuera Street) •3 studio units (448 to 530 sf) •6 one-bedroom units (671 to 874 sf) •3 two-bedroom units (938 to 1,001 sf) •8 hotel suites (372 to 1,260 sf) •Wrap-around walkways and decks, private balconies •Long-term bicycle storage room Project Description Site Plan 47 Building A Building B •Two buildings connected by 4th floor walkway •Existing drive between Higuera and Marsh to remain, crosswalks across drive •26 surface parking spaces •48-space mechanical lifts •21 short-term bicycle spaces •39-long term bicycle storage and space within units •Pedestrian walkways & patios •Trees along southwest property boundary and street frontage •Public patio with seating and horizontal wood screen fence Site Plan –Landscaping 48 Background 49 Building A Building B •The Architectural Review Commission (ARC) reviewed the proposed project on September 9, 2019 and October 21, 2019 for consistency with the CDG and voted to recommend approval of the project with additional direction for minor modifications (7-0). •On January 8, 2020, the Planning Commission reviewed the proposed project on January 8, 2020, and a motion passed (5-2) to continue the item to a date uncertain with direction provided to the applicant, related to consistency with the CDG. •The applicant incorporated design changes to the project, which were reviewed by the Planning Commission, resulting in the Planning Commission’s approval of the project on February 26, 2020 (4-2-1). Appeal Item #1: Project not consistent with Community Design Guidelines Chapter 5 (Residential Project Design) and 1.4 50 Building A Building B •Staff Analysis: •Mixed-use Project is in the Downtown Commercial (C -D) zone; CDG Chapter 5 does not apply •Project is consistent with CDG 1.4(A)(4): 1.4 –Goals for Design Quality and Character A.Keep San Luis Obispo architecturally distinctive, don’t let it become “anywhere USA.” 4.Design with consideration of the site context in terms of the best nearby examples of massing, scale, and land uses when the site is located in a notable area of the city (for example, the Downtown, Old Town). Community Design Guidelines Consistency 51 Materials and Colors •Limestone material is replaced by brick, and metal and wood siding materials are replaced by smooth-finished stucco •Lighter shades of tan, particularly on the second and third floors •Modification of balcony railings from metal and glass to all metal Community Design Guidelines Consistency 52 Windows •Shape, size, orientation, framing, and location of the windows has been modified to reflect existing vertically- oriented windows on neighboring buildings •Windows on all elevations will be consistent, and clear glass is proposed •Larger window headers (light in color) and a reduction in the metal and glazing between windows Community Design Guidelines Consistency 53 Other Details •Bulkhead incorporated into the stepped-back storefront (which also reduces the size of the storefront windows) on the north elevation of Building B (Marsh Street) •Vertical rather than angular canopy posts to better reflect linear posts present on proximate buildings Community Design Guidelines Consistency 54 Other Details •Overall massing is broken down with decks and balconies, additional decks and balconies are shown on the second and third floors Proximity to Pollard House 55 Proximity to Pollard House: •Building façade lowered to two stories (28 feet) •29-foot setback (43 feet from Pollard House) •5-foot step-back (3rd floor) •5-foot step-back (4th floor) •Landscaping, trees •Historic analysis determined no significant impact to historic resources Visual Transitions 56 27’8” 50’ 18’6” 27’ 42’50’ 36’2” 27’ Appeal Item #2: Project not exempt from CEQA, would cause substantial adverse change in the significance of historic resources 57 •15300.2 (Categorical Exemptions, Exceptions): A categorical exemption shall not be used for a project which may cause a substantial adverse change in the significance of a historical resource. •15064.5 (b) (Determining the Significance of Impacts to Archaeological and Historical Resources): A project with an effect that may cause a substantial adverse change in the significance of an historical resource is a project that may have a significant effect on the environment. •Substantial adverse change in the significance of an historical resource means physical demolition, destruction, relocation, or alteration of the resource or its immediate surroundings such that the significance of an historical resource would be materially impaired. •The significance of an historical resource is materially impaired when a project: demolishes or materially alters in an adverse manner those physical characteristics of an historical resource that convey its historical significance and that justify its inclusion in, or eligibility for, inclusion in the California Register of Historical Resources, local register of historical resources. California Environmental Quality Act (CEQA) 58 •SWCA Historic Preservation Report and Historical Compatibility Improvement Letter: •Does not identify a substantial adverse change as defined by CEQA •States that none of the adjacent historic properties and none of the more distantly located historic properties will be subject to any indirect impacts that threaten their eligibility as significant historical resources. Appeal Item #3: Owing to unusual circumstances, project is capable of causing significant adverse impact on historical resources 59 •Staff Analysis: •Project is consistent with the General Plan and meets the intent of the General Plan for the Downtown •Project is consistent with the Downtown Concept Plan •A mixed-use project consistent with the Zoning Regulations for the C-D zone •The project’s height, size, and scale are generally consistent with other buildings in the Downtown •The presence of historic resources is not an unusual circumstance in the Downtown and infill environments to which the exemption applies Appeal Item #4: Project not subject to “infill” exemption or any exemption because inconsistent with CDG and LUCE CR-2 3.3.5 60 •Staff Analysis: •Conservation and Open Space Element Policy 3.3.5 (Historic districts and neighborhoods) states that: “In evaluating new public or private development, the City shall identify and protect neighborhoods or districts having historical character due to the collective effect of Contributing or Master List historic properties.” •The project site is not located within an identified historic district or neighborhood, and the project site is currently developed with commercial and office development, and the General Plan and Downtown Concept Plan calls for the type of development proposed in this location. •The project incorporates features to provide separation and transition between the site and the identified historic resource and would not affect the eligibility of those resources to remain. Appeal Item #5: Project not subject to exemption due to incorporation of mitigation measures 61 •Staff Analysis: •The proposed project’s modifications through staff and advisory body review do not constitute mitigation measures as defined by CEQA. No significant adverse impact to historic resources was identified for the project as currently proposed. Appeal Item #6: Project is capable of causing cumulatively significant impact on historical resources 62 •Staff Analysis: •While the combination of other projects in the vicinity have resulted in a cumulative effect, none of the projects resulted in a significant effect and as noted above, the proposed project would not have a significant effect on historical resources as defined by the State CEQA Guidelines. •The project is consistent with the General Plan and Zoning Regulations, in addition to the CDG, and would not have a project-specific or cumulative effect on aesthetics. Appeal Item #6: Project is capable of causing cumulatively significant impact on historical resources 63 •Land Use and Circulation Element (LUCE) EIR Aesthetic Cumulative Impacts Analysis Section states the following: •“Overall, development under the General Plan would increase development intensity within the city limits, as well as undeveloped areas to a more built environment, thereby altering the fundamental character of these areas, and increasing light and glare.” •The General Plan and the Community Design Guidelines (CDG) “protect the city’s visual features through policies and plan review. Adherence to these requirements would reduce any impacts from buildout…to a less than significant level.” •Project has been reviewed by the Architectural Review Commission (ARC) whose purview consists of review of consistency with the CDG; the ARC recommended approval of the project with previously-noted minor modifications. •Previously-approved projects in the neighborhood and vicinity were found to be consistent with the General Plan and CDG. •Therefore, no significant cumulative aesthetic impacts would occur. Appeal Item #7: Project not a housing development project 64 •Staff Analysis: •Project is a mixed-use development consisting of 2/3 residential uses, meeting the Government Code definition of a housing development project. Appeal Item #8: Project would cause a significant impact on historic resource as defined by the Historic Preservation Ordinance 65 •Staff Analysis: •The Historic Preservation Ordinance (HPO) identifies an adverse impact as “effects, impacts or actions that are detrimental or potentially detrimental to a historic resource’s condition, architectural or historical integrity.” •Historical Compatibility Letter concludes that none of the adjacent historic properties and none of the more distantly located historic properties will be subject to any indirect impacts that threaten their eligibility as significant historical resources. Appeal Item #9: Project was not evaluated by the Cultural Heritage Committee 66 •Staff Analysis: •The HPO, specifically section 14.01.030(C)(7) states that the Cultural Heritage Committee (CHC) shall review and make recommendations…on applications and development review projects which include…the following: Proposed actions of public agencies that may affect historic or cultural resources within the City. •HPO Section 14.01.040 states that the Community Development Director is responsible for interpreting and implementing this ordinance and helping the CHC carry out its duties. Notwithstanding Section 14.01.030C 1 -5 and 7 of this ordinance, the Director may determine that CHC review is not required for actions or projects that do not adversely affect historic resources. •As noted above, the project would not have an adverse effect on historic resources; therefore, the project was not referred to the CHC. Questions for staff? 67 Project Description Site Plan 68 Pollard House Norcross House Mechanical lifts 48 vehicle spaces 21 short-term spaces 39 long-term storage, & storage within units Project Description 69 •Height: 50 feet, 58-foot tall elevator tower •Materials: stucco, limestone, concrete bulkhead, wood siding, metal accents •3rd floor step-back: 5 feet (SW) •4th floor step-back from 2nd floor: -5 feet (north) -5 to 7 feet (south) -5 to 12 feet (west) -10 to 15 feet (east) Evaluation Summary 70 •Project consistent with General Plan •Commercial and residential uses •Provides public gathering space and walkways •Design shows setbacks, step -backs, and landscaping, demonstrating compatibility with proximate structures •Project complies with Zoning Regulations •Project complies with Mixed-use Design Standards and Criteria and Performance Measures (as proposed and conditioned) •Visual study did not identify adverse impacts •No significant impacts to proximate historic resources Item #12 (continued) PUBLIC HEARING ITEM 545 Higuera & 486 Marsh (ARCH-0017-2019) Applicant Team Presentation By: Joel Snyder, Ten Over Studio Item #12 (continued) PUBLIC HEARING ITEM 545 Higuera & 486 Marsh (ARCH-0017-2019) Appellant Team Presentation By: Babak Naficy James Papp “It is the policy of this state to take all action necessary to provide the people of this state with clean air and water and enjoyment of aesthetic, natural, scenic, and historic environmental qualities” California Environmental Quality Act, 1970 Appeal of Planning Commission Approval of 545 Higuera–486 Marsh San Luis Architectural Preservation! and Save Our Downtown 545 Higuera–486 Marsh is not consistent with the Community Design Guidelines 545 Higuera–486 Marsh is not eligible for an infill exemption or any other exemption from CEQA environmental review because of • the exception for substantial adverse change in the significance of historical resources • the exception for significant effect on the environment due to unusual circumstances • the exception for cumulative impact on the aesthetic and historical environment • failure to apply earlier LUCE mitigation, including the Community Design Guidelines and the Conservation and Open Space Element • the requirement to incorporate mitigation measures 545 Higuera–486 Marsh is not a “housing development project” subject to the Housing Accountability Act Losing eligibility for historic resource listing is neither defined nor recognized under SLO’s Historic Preservation Ordinance or CEQA Statute, CEQA Guidelines, or CEQA case law as the criterion for substantial adverse change in the significance of a historical resource The Historic Preservation Ordinance requires evaluation of 545 Higuera –486 Marsh by the Cultural Heritage Committee for “proposed actions of public agencies that may affect historic or cultural resources within the City” LIAISON REPORTS AND COMMUNICATIONS 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 next Regular City Council Meeting is scheduled for Tuesday,June 16,2020 at 6:00 p.m.,via teleconference. Agendas for Council Meetings are published no later than 72 hours before the meeting date.Refer to the agenda for Webinar registration details and instructions for providing public comment. The Regular Meeting of the City Council / Disaster Council will resume shortly *Recess in Progress*