HomeMy WebLinkAboutItem 6c - Lease Amendment No. 3 with City Farm SLO Item 6c
Department: Administration
Cost Center: 1005
For Agenda of: 9/16/2025
Placement: Consent
Estimated Time: N/A
FROM: Greg Hermann, Deputy City Manager
Prepared By: Robert Hill, Sustainability & Natural Resources Official
SUBJECT: LEASE AMENDMENT NO. 3 WITH CITY FARM SLO
RECOMMENDATION
Authorize Lease Amendment No. 3 to the Lease Agreement between the City of San Luis
Obispo and Central Coast Ag Network, dba City Farm SLO, to add an additional 1.5 acres
of farmland to the lease area (Attachment A).
POLICY CONTEXT
The City of San Luis Obispo’s Conservation and Open Space Element of the General
Plan (2016) states that "Publicly owned agricultural lands should be leased back to
farmers or used as demonstration projects that will benefit local farmers" and “The City
should lease lands designated Agriculture for continued agricultural use, provided the
lease agreement reflects all City policies and management objectives.”
In January 2011, the City established the Calle Joaquin Agricultural Reserve for the
purpose of preserving significant parts of "this signature working agricultural landscape"
at the City's southern gateway. The plan document for the Calle Joaquin Agricultural
Reserve (2011) states that “operation will be in the hands of a nonprofit entity which,
pursuant to an agreement with the City of San Luis Obispo, will be responsible for the
overall capital improvements, operation, and maintenance of the agricultural operat ions
of the site.”
The City’s Land Use Element (2014) includes Policy 1.9.1, Agricultural Protection: “The
City shall support preservation of economically viable agricultural operations and land
within the urban reserve and city limits.”
The City’s Climate Action Plan for Community Recovery (2022) within the Natural
Solutions section, Pillar 6, states: “The Calle Joaquin Agricultural Reserve (locally known
as “City Farm”) is part of City’s Greenbelt Protection Program —a system of protected
natural resources and conserved landscapes that is central to maintaining the City’s
identity and unique sense of place. In addition to carbon sequestration, the City’s
Greenbelt provides tremendous climate resilience benefits including shading and cooling,
Page 19 of 615
Item 6c
stormwater management and watershed protection, as well as buffering from extreme
heat events, catastrophic flooding, and wildfires.”
The City’s Financial Management Manual (Section 475-C) allows for long-term leases of
City property, as well as provisions for leases to non -profit organizations, where there is
a clear link to accomplishment of significant City goals, plans, or policies and where the
proposal has a clear and measurable community benefit.
DISCUSSION
Background
Since 2013, the City of San Luis Obispo has partnered with the Central Coast Ag Network
(doing business as “City Farm SLO”) to offer prime agricultural farmland to small
sustainable farmers, as well as to provide hands-on educational programming for local
youth. The City currently leases to City Farm SLO approximately 20 acres of agricultural
farmland located within City limits.
In 2021, City Farm SLO reached a series of milestones set forth in the original 2013
Agricultural Ground Lease, as well as other important goals, including the establishment
of public programming, demonstration gardens, an orchard, and infrastructure including
on-site solar energy generation, a produce cooler, and livestock shed. Further, City Farm
SLO’s 2021 Strategic Plan affirmed four major goals: (1) providing affordable land for
small sustainable farms; (2) offering farm-based education for at-risk and under-served
youth; (3) modeling regenerative agricultural practices; and (4) fostering a diverse
community focused on food and farming.
In recent years, City Farm SLO has continued to grow as an organization and increase
its presence in the community. Noteworthy activity includes their relationships with the
San Luis Coastal Unified School District and Pacific Beach High School, SLO Food Bank,
and the College Corps Fellowship Program, as well as programming such as the Youth
Empowerment Program, The Garden For All therapeutic horticulture project, the Prefumo
Creek Riparian Restoration and Enhancement Project, and ongoing sustainable and
regenerative farming practices with a suite of local farmers.
Previous Council Action
In January 2013, the City Council approved the Agricultural Ground Lease for “the
purpose of putting the majority of the Premises into active sustainable agricultural use …
[and] facilities to provide educational and agricultural support.” (Attachment B.)
In November 2013, the City Council approved Lease Amendment No. 1 in order to add
an additional three acres into the leased premises following the City’s successful
resolution of a title dispute that had affected that area.
In January 2022, the City Council approved Lease Amendment No. 2 that extend ed the
term for another 40 years, amended terms to reflect operational changes, as well as to
incorporate updates in local and state legislation governing water use in the context of
the Sustainable Groundwater Management Act (SGMA).
Page 20 of 615
Item 6c
Lease Amendment No. 3
On June 18, 2025, the City received a letter request from City Farm SLO requesting the
addition of approximately 1.5 acres of City land be added to the existing lease area
(Attachment C). This subject land was dedicated to the City at the same time as other
areas of what now constitutes the Calle Joaquin Agricultural Reserve (City Farm) as the
open space remainder of Parcel Map SLO 04-0615. The plan document for the property
identifies this site as “Phase 1B” (Figure 7, p.19). The narrative description (p.18) of
Phase 1B is as follows:
Phase 1B includes improvements and activities in area s that are City controlled or
maintained. These may include but are not limited to:
Initial extension of the Bob Jones Trail from Calle Joaquin to Oceanaire
Drive via a pedestrian/bicycle bridge over Prefumo Creek, with ultimate
connection to either Madonna Road or Dalidio Drive (possibly both);
Possible community garden or native plant nursery;
Possible wetland meadow at the southern corner of the property; and
Riparian enhancement plantings along Prefumo Creek and the fill area at
the south end of the property, along with control of date palms and other
non-native vegetation.
In the intervening time since 2011, there have been substantive updates to the potential
uses identified for Phase 1B. In the 2011 to 2014 timeframe, staff installed plantings
intending to foster the “wetland meadow” concept, however, with ongoing drought that
was occurring during that time, together with challenging site characteristics, those efforts
were unsuccessful. Notably, on September 3, 2019, the City Council opted not to pursue
the extension of the Bob Jones Trail through the property, instead choosing to focus on
Tier 1 active transportation infrastructure along Los Osos Valley Road between Calle
Joaquin and Froom Ranch Way (see: Council Agenda Report and Resolution 11043
(2019 Series)). Community garden plots will now be available at the SLO Ranch Farms
and Marketplace as part of the San Luis Ranch Specific Plan. Riparian enhancement,
removal and control of date palms and other non -native vegetation has occurred as part
of the Prefumo Creek Riparian Restoration and Enhancement Project, as well as
installation of an interpretive and educational walking path along the creek.
City Farm SLO now proposes to add this land to their existing inventory for uses
consistent with existing lease terms, including implementation of the current Strategic
Plan, sustainable agriculture, education, and community engagement. Based on first-
hand observation, City Farm SLO notes that the site has received some level of flooding
for 1-5 days over the past three years. It is envisioned that cropping would either be
seasonal or with the intention of a crop selection that can withstand occasional flooding,
as well as to continue with riparian enhancement efforts and natural drainage and
infiltration techniques. Because the proposed lease addition would not conflict with
potential activities identified for Phase 1B, or would continue to implement them, and the
addition would increase capacity for City Farm SLO’s farming operations and Strategic
Plan goals, staff is supportive of this request.
Page 21 of 615
Item 6c
Public Engagement
An extensive public engagement process was undertaken at the time that the Calle
Joaquin Agricultural Reserve and plan document were established, including community
meetings and public hearings, leading to the decision to establish a re lationship with a
non-profit entity capable of implementing sustainable farming operations and educational
activities.
Any member of the public may comment on this item either in person at the City Council
meeting or by written comment received prior to the meeting.
CONCURRENCE
The Parks and Recreation Department’s Ranger Service division concurs with the
recommendation, which would lesson maintenance and patrol duties for this property
since City Farm is responsible for maintenance of the Premises under the Agricultural
Ground Lease (see section 15.).
ENVIRONMENTAL REVIEW
The activities proposed by City Farm SLO are consistent with the Environmental Review
and Mitigated Negative prepared for the Calle Joaquin Agricultural Reserve in 2011. The
proposed addition of 1.5 acres of land to City Farm SLO’s existing lease is Categorically
Exempt under CEQA Guidelines Section 15325(b) “Acquisition, sale, or other transfer of
areas to allow continued agricultural use of the areas” and 15325(d) “Acquisit ion, sale, or
other transfer to prevent encroachment of development into flood plains.”
FISCAL IMPACT
Budgeted: No Budget Year: 2025-26
Funding Identified: No
Fiscal Analysis:
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund
State
Federal
Fees
Other:
Total N/A N/A N/A N/A
The proposed 1.5-acre lease addition does not have a fiscal impact in and of itself. It
would require very modest staff time to oversee the continued adherence to the lease
agreement. Consistent with Financial Management Manual Section 475-C regarding
Page 22 of 615
Item 6c
long-term leases of City facilities where there is clear link to accomplishment of significant
City goals, plans, or policies and where the proposal has a clear and measurable
community benefit, the existing Agricultural Ground Lease is made at $1.00 per year. This
lease rate is proposed to continue with the 1.5 -acre land addition where it is anticipated
that community benefits and achievement of City goals will also expand. Should City Farm
SLO elect to sub-lease the area, the revenue from such a sub-lease is required to be
used in furtherance of the organization’s Strategic Plan implementatio n and allowable
uses, all as allowed under the terms of the lease.
ALTERNATIVES
Council has several alternative options.
1. Council could request additional information, clarification, or changes to the
terms of the draft Lease Amendment No. 3 before taking action.
2. Council could decide not to approve the draft Lease Amendment No. 3. Should
Council pursue this option, staff suggests identifying or proposing uses or activities to
provide staff with guidance for future management of the site. It should b e noted that
the subject land is not suitable for most land uses other than agriculture or natural
resources conservation.
ATTACHMENTS
A - Draft Lease Agreement Amendment No. 3
B - Agricultural Ground Lease (2013)
C - Letter of Interest from City Farm SLO
Page 23 of 615
Page 24 of 615
1
AMENDMENT NO. 3
AGRICULTURAL GROUND LEASE BETWEEN
THE CITY OF SAN LUIS OBISPO AND
CENTRAL COAST AG NETWORK
This Amendment No. 3 to the Agricultural Ground Lease (“Lease”) is entered into this __ day
of ________________, by and between the City of San Luis Obispo (the "City") and Central Coast Ag
Network, a California public benefit non-profit corporation ("CCAN").
RECITALS
A. The City owns certain agricultural land within City limits, commonly identified as the
Calle Joaquin Agricultural Reserve, 0 Calle Joaquin, San Luis Obispo.
B. CCAN is a nonprofit corporation whose purpose is to champion a sustainable local and
regional food system to ensure a nourishing, diverse and abundant supply of food that is resilient, safe
and secure, and CCAN seeks to manage the on-site agricultural production and agricultural education
and activities under sustainable agriculture practices.
C. On January 7, 2013, the City and CCAN entered into the Lease for the purpose of
putting the majority of the Premises into active sustainable agricultural use, while permitting
development of a portion of the Premises, not to exceed the percentage allowable per zoning
regulations, for facilities for the aggregation, light processing and distribution of agricultural products
grown locally or on the Premises as part of a local food system as well as facilities to provide
educational and agricultural support.
D. On February 1, 2013, the City acquired additional property and on May 2, 2013, entered
into Amendment No. 1 with CCAN to add this additional property into the Premises.
E. On January 27, 2022, the City entered into Amendment No. 2 that extended the term for
another 40 years, and amended terms to reflect operational changes, as well as to incorporate updates in
local and state legislation governing water use in the context of the Sustainable Groundwater
Management Act (SGMA).
F. On June 18, 2025, the City received a letter request from CCAN (City Farm SLO)
requesting the addition of approximately 1.5 acres of contiguous City land to the existing Lease area.
G. Both City and CCAN desire to expand the lease area with this Amendment No. 3, and
the existing Lease rate of $1.00 per year will continue in consideration of CCAN’s ability to also
continue to expand its delivery of clear and measurable community benefits and accomplishment of
significant City goals, plans, or policies, as provided for under Section 475-C of the City’s Financial
Management Manual.
AGREEMENT
1. The area of the City’s Lease with CCAN is hereby amended to include an additional
area of approximately 1.5 acres, as shown on Exhibit A, which is incorporated herein.
Page 25 of 615
2
2. The additional land area will be operated and managed consistent with all other terms
and conditions of the Lease, which shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day
and year first written above.
CITY OF SAN LUIS OBISPO
_________________________________
Mayor
ATTEST:
____________________________
City Clerk
Approved:
____________________________
City Manager
Approved to as form:
____________________________
City Attorney
CENTRAL COAST AG NETWORK, a California public benefit non-profit corporation
__________________________
President
___________________________
Secretary
Page 26 of 615
3
EXHIBIT A
Page 27 of 615
Page 28 of 615
Page 29 of 615
Page 30 of 615
Page 31 of 615
Page 32 of 615
Page 33 of 615
Page 34 of 615
Page 35 of 615
Page 36 of 615
Page 37 of 615
Page 38 of 615
Page 39 of 615
Page 40 of 615
Page 41 of 615
Page 42 of 615
Page 43 of 615
Page 44 of 615
Page 45 of 615
Page 46 of 615
June 18, 2025
San Luis Obispo City Council
990 Palm Street
San Luis Obispo, CA 93401
Dear Mayor Stewart and Members of the San Luis Obispo City Council,
On behalf of the Board of Directors of City Farm SLO, we are writing to respectfully request the addition
of approximately 1.4 adjacent acres of unused City land to our existing lease agreement, to be used in
accordance with the established purpose and intent of that lease. See map attached.
City Farm SLO has worked in partnership with the City since 2013 to transform public land into a vibrant
community asset. As outlined in Section 2 of our lease, the purpose of this agreement is “to put the
majority of the Premises into active sustainable agricultural use,” while also permitting a portion of the
land to support the development of facilities for aggregation, light processing, distribution, education,
and agricultural support, all in service to a resilient local food system.
With this in mind, we request the opportunity to lease additional acreage adjacent to our current site to
expand our impact. All proposed uses will remain consistent with the original lease purpose and City
Farm SLO’s current Strategic Plan, emphasizing sustainable agriculture, education, and community
engagement.
We welcome the opportunity to meet with City staff and Councilmembers to discuss this request further
and answer any questions you may have. Thank you for your continued partnership.
Sincerely,
Gina Brausch
Board Chair, City Farm SLO
On behalf of the City Farm SLO Board of Directors
ginaruedeb@gmail.com
Central Coast Ag Network, Inc. dba City Farm SLO
PO Box 3736 • San Luis Obispo, CA 93403 • 805-769-8344 • info@cityfarmslo.org • cityfarmslo.org Page 47 of 615
Page 48 of 615