HomeMy WebLinkAbout07-19-2016 Council Agenda Packet
Tuesday, July 19, 2016
6:00 PM
REGULAR MEETING
Council Chamber
990 Palm Street
San Luis Obispo Page 1
CALL TO ORDER: Mayor Jan Marx
ROLL CALL: Council Members John Ashbaugh, Carlyn Christianson, Dan
Rivoire, Vice Mayor Dan Carpenter, and Mayor Jan Marx
PLEDGE OF ALLEGIANCE: Vice Mayor Dan Carpenter
INTRODUCTIONS
1. SCOTT LEE, PUBLIC WORKS PARKING SERVICES MANAGER AND ADAM
FUKUSHIMA, ACTIVE TRANSPORTATION MANAGER (GRIGSBY – 10
MINUTES)
APPOINTMENTS
2. APPOINTMENT TO THE BICYCLE ADVISORY COMMITTEE (BAC) (PRICE /
GOODWIN – 5 MINUTES)
Recommendation
In accordance with the recommendations of the Council Subcommittee, confirm the
appointment of Ken Kienow to the Bicycle Advisory Committee to complete an unexpired
term through March 31, 2018.
San Luis Obispo City Council Agenda July 19, 2016 Page 2
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.
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. SELECTION OF VOTING DELEGATE AND ALTERNATES - LEAGUE OF
CALIFORNIA CITIES ANNUAL CONFERENCE (PRICE)
Recommendation
Appoint Mayor Jan Marx as the voting delegate and Council Members Ashbaugh and
Christianson as alternate voting delegates to vote on the City’s behalf at the Annual
Business Meeting of the League of California Cities on Friday, October 7, 2016.
5. REQUEST FOR PROPOSALS FOR COMMUNITY OUTREACH AND
COMMUNICATIONS SUPPORT SERVICES (JOHNSON / HERMANN)
Recommendation
1. Authorize the issuance of a Request for Proposals for Consultant Services for
community outreach and communications support services; and
2. Authorize the City Manager to award the contract if proposals are within the project
budget of $139,500.
San Luis Obispo City Council Agenda July 19, 2016 Page 3
6. LEASE AGREEMENT FOR 999 MONTEREY STREET, SUITE 345 (CODRON /
COX)
Recommendation
Approve and authorize the City Manager to execute a lease agreement in a form subject to
the approval of the City Attorney for 2,000 square feet of office space at 999 Monterey
Street, Suite 345 between the City of San Luis Obispo and Jamestown Premier SLO Retail,
L.P.
BUSINESS ITEMS
7. CONSIDERATION OF THE PROPOSED CHANGES TO THE CITY’S PUBLIC
ART POLICY (STANWYCK / MUDGETT – 30 MINUTES)
Recommendation
As recommended by the Parks and Recreation Commission, review and approve proposed
changes to the City’s Public Art policies to include an update to the Utility Box Art program
specifying the program’s maintenance, replacement, expansion and archival of box art
murals.
8. GUIDING PRINCIPLES FOR THE DIABLO CANYON POWER PLANT CLOSURE
AND RELATED ISSUES (LICHTIG / L. JOHNSON / HERMANN – 30 MINUTES)
Recommendation
Adopt Guiding Principles to provide direction to staff as the Diablo Canyon Power Plant
Closure and related moves through the various regulatory processes.
COUNCIL LIAISON REPORTS
(Not to exceed 15 minutes) Council Members report on conferences or other City activities.
Time limit—3 minutes each.
COUNCIL COMMUNICATIONS
(Not to exceed 15 minutes) At this time, any Council Member or the C ity 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)
San Luis Obispo City Council Agenda July 19, 2016 Page 4
ADJOURNMENT
The Regular City Council Meeting of August 2, 2016 was previously cancelled. Consequently,
the next Regular City Council Meeting is scheduled for Tuesday, August 16, 2016 at 6:00 p.m.
in the Council Chamber, 990 Palm Street, San Luis Obispo, California.
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.
Meeting Date: 7/19/2016
FROM: Lee Price, Interim City Clerk
Prepared By: Heather Goodwin, Deputy City Clerk
SUBJECT: APPOINTMENT TO THE BICYCLE ADVISORY COMMITTEE (BAC)
RECOMMENDATION
In accordance with the recommendations of the Council Subcommittee, confirm the appointment
of Ken Kienow to the Bicycle Advisory Committee to complete an unexpired term through
March 31, 2018.
DISCUSSION
Bicycle Advisory Committee (Subcommittee Members Rivoire and Ashbaugh)
Due to the resignation of Peter Deragon, effective June 1, 2016, there was an unscheduled
vacancy on the Bicycle Advisory Committee. Mr. Deragon’s term would have expired on March
31, 2018. In accordance with Council Policies and Procedures Section 6.7.2.5, the Council
Liaison Subcommittee recommends the appointment of Ken Kienow, effective July 19, 2016, to
a term expiring on March 31, 2018. It is noteworthy to mention that Mr. Kienow was
reappointed to the Citizens’ Revenue Enhancement Oversight Commission (REOC) in June
2016. As a general policy, an applicant shall not be appointed to serve on more than one advisory
body, except that a member may also serve on one technical or special purpose committee. Mr.
Kienow’s appointment falls within this specified exception.
AVAILABLE FOR REVIEW IN THE COUNCIL OFFICE
A copy of Ken Kienow’s application has been provided to the City Council and is available for
public review in the City Clerk’s office.
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Meeting Date: 7/19/2016
FROM: Lee Price, Interim City Clerk
SUBJECT: SELECTION OF VOTING DELEGATE AND ALTERNATES - LEAGUE OF
CALIFORNIA CITIES ANNUAL CONFERENCE
RECOMMENDATION
Appoint Mayor Jan Marx as the voting delegate and Council Members Ashbau gh and
Christianson as alternate voting delegates to vote on the City’s behalf at the Annual Business
Meeting of the League of California Cities on Friday, October 7, 2016.
DISCUSSION
The League of California Cities Annual Conference will be held on Octo ber 5-7, 2016 in Long
Beach. An important component of the Annual Conference is the Annual Business Meeting
scheduled for noon on Friday, October 7, 2016. At this meeting, the League membership will
consider and take action on resolutions that establish League policy. In order to vote at the
Annual Business Meeting, the City Council must designate a voting delegate. Council may also
appoint up to two alternate voting delegates, one of whom may vote in the event that the
designated voting delegate is unable to serve in that capacity.
Attachments:
a - Designation of Voting Delegates and Alternates
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Meeting Date: 7/19/2016
FROM: Derek Johnson, Assistant City Manager
Prepared By: Greg Hermann, Principal Analyst
SUBJECT: REQUEST FOR PROPOSALS FOR COMMUNITY OUTREACH AND
COMMUNICATIONS SUPPORT SERVICES
RECOMMENDATION
1. Authorize the issuance of a Request for Proposals for Consultant Services for community
outreach and communications support services; and
2. Authorize the City Manager to award the contract if proposals are within the project
budget of $139,500.
DISCUSSION
Background
As a part of the Organizational Efficiency and Effectiveness SOPC approved with the 2016-17
Supplemental Budget, additional resources were made available to enhance communications
functions at the City.
The goal of City communication functions is to ensure mutually beneficial, two-way
communication with external (such as residents, non-profit service providers, business owners
and operators, business community representatives, other governmental agencies among others)
and internal audiences about City issues and services. The intended outcome is a more
responsive government, enhanced transparency, a high level of public confidence and increased
community satisfaction with City communication.
Currently, communication strategies and tactics are decentralized, often resultin g in duplication
of effort and inefficient use of staff time. It is envisioned that the use of consultant services will
help to streamline communication to provide important information to community members
more quickly and, internally, to ensure effective and efficient exchange of information between
City departments and employees. The focus of the consultant work will be on communication
planning, content creation, community and media outreach, training, strategic counsel and
several additional tasks as needed.
The consultant will work through a single point of contact in the City’s Administration
Department who will manage timelines and deliverables for individual tasks. A scope of work is
provided in the draft RFP, however, the final scope of work will be finalized with the selected
consultant as a part of the contract during negotiations. At this time a contract with a
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communications consulting firm is being pursued as an alternative to hiring a staff person to
perform these functions. This approach is being pursued to assess the need for this scope of work
on an on-going basis. The services provided will be assessed and modified based on periodic
review of services provided by the consulting firm.
Scope of Work
The consultant will assist the City with the following communications tasks in addition to those
identified in the final scope of work:
1. Planning
a. Prepare a 12 month communication plan (including measurable objectives,
overarching messages/themes, audiences, strategies and tactics). Prepare a 12
month work plan describing implementation deliverables and timing. For the
purpose of budgeting, consultants can assume city staff have gained consensus on
an overall goal for the communication program. Review and propose needed
modifications to existing policies, procedures and guidelines (such as the 2003
Press Policy & Public Information Manual and the 2015 Public Engagement and
Noticing Manual).
2. Content Creation and Community/Media Outreach
a. Create public information as needed for city issues, events, projects and services
including writing news releases, articles, website content, fact sheets and other
informational materials.
b. Assist with scheduling of, and participation in, community and media outreach.
c. Identify and develop various outreach methods to enhance community
engagement and education of external and internal audiences.
3. Communication and Media Outreach Training
a. Provide training for City employees on communications and media outreach skills
including:
i. Effective message delivery (how to avoid jargon, using simple messages,
etc.)
ii. Spokesperson training (on camera practice of message delivery for at least
eight employees)
iii. Writing effective public information (focus on clear, concise, active
writing style)
iv. Provide training for City employees on effective community outreach and
engagement including workshop design, facilitation skills and other best
practices.
4. Strategic Counsel
a. Provide ongoing strategic counsel to city staff, as needed, on issues, programs and
plan implementation.
5. Emergency Communications
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a. As needed, assist with emergency communication services, including serving as
support in the City’s Emergency Operations Center during an emergency incident.
6. Optional Services
a. Optional Services may include professional photography, videography and
graphic design services to assist in communicating about City issues, programs
and services.
ENVIRONMENTAL REVIEW
There is no environmental review required for this action as it is not a project as defined under
the California Environmental Quality Act (CEQA).
FISCAL IMPACT
The City has set aside hours with the Administration Department, led by the Principal Analyst to
oversee this RFP and manage the selected consultant. A budget of $119,500 has been
appropriated for communications support services with an additional $20,000 available for
graphic design and photography. The funding was approved as a part of the Organizational
Efficiency and Effectiveness SOPC with the 2016-17 Supplemental Budget.
ALTERNATIVES
The City Council may:
1. Request additional information or analysis from staff. Specific direction should be
provided related to any additional analysis.
2. Modify the request to issue a RFP for the citywide community outreach and
communications support services. Specific modifications should be identified so that the
City provides a clear scope of work.
3. Deny the request to issue a RFP for the citywide communications support and provide
alternative direction to staff on how to accomplish the objective of enhancing community
outreach and communications.
Attachments:
a - Communications Support RFP
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990 Palm Street San Luis Obispo, CA 93401
Notice Requesting Proposals for
Community Outreach and Communications Support Services
Specification No. 91493
The City of San Luis Obispo is requesting sealed proposals for citywide communications support
services pursuant to Specification No. 91493. All proposals must be received by the Finance
Division by 4 p.m., August 3, 2016 when they will be opened publicly in the foyer of the City
Hall Council Chambers, 990 Palm Street, San Luis Obispo, CA 93401.
Proposals received after said time will not be considered. To guard against premature opening,
each proposal shall be submitted to the Finance Division in a sealed envelope plainly marked
with the proposal title, specification number, proposer name, and time and date of the proposal
opening. Proposals shall be submitted using the forms provided in the specification package.
Requests for additional information or questions that prospective proposers may have regarding
the City's request for proposals may be directed Greg Hermann, Principal Analyst, by phone at
(805) 781-7194 or by email at ghermann@slocity.org.
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Specification No. 91493
TABLE OF CONTENTS
A. Description of Work 1
B. General Terms and Conditions 4
Proposal Requirements
Contract Award and Execution
Contract Performance
C. Special Terms and Conditions 8
Contract Term
Estimated Quantities
Proposal Content
Proposal Evaluation and Selection
Proposal Review and Award Schedule
Unrestrictive Brand Names
Start and Completion of Work
Accuracy of Specifications
D. Agreement 13
E. Insurance Requirements 15
F. Proposal Submittal Forms 17
Proposal Submittal Summary
References
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Section A
DESCRIPTION OF WORK
The City of San Luis Obispo (“City”) seeks proposals for consultant services for community
outreach and communications support services to enhance community outreach and engagement
through more robust and coordinated communication functions within the City.
I. GENERAL
The goal of City communication functions is to ensure mutually beneficial, two-way
communication with external (such as residents, non-profit service providers, business owners
and operators, business community representatives, other governmental agencies among others)
and internal audiences about City issues and services, leading to a more responsive government
and a high level of public confidence. . It is anticipated that the outcome from this effort will be
increased community satisfaction with City communication.
Currently, communication strategies and tactics are ad hoc and decentralized, often resulting in
duplication of effort and inefficient use of staff time. It is envisioned that the use of consultant
services will help to streamline communication to get important information to community
members more quickly and, internally, to ensure effective and efficient exchange of information
between City departments and employees. The focus of the consultant work will be on
communication planning, content creation, community and media outreach training, strategic
counsel and several additional tasks as needed.
The consultant will work through a single point of contact in the City’s Administration
Department who will manage timelines and deliverables for individual tasks. A sample scope of
work is provided, however, the final scope of work will be determined with the selected
consultant as a part of the contract during negotiations. At this time a contact with a
communications consulting firm is being pursued as an alternative to hiring a staff person to
perform these functions. This approach is being pursued to assess the need for this scope of work
on an on-going basis. The services provided will be assessed and modified based on periodic
review of services provided.
Interested consultants will provide a maximum 10-page proposal that outlines their approach for
communications support services. The City expects to expend no greater than $119,500 for all
services included in the contract (excluding optional services as defined which may not exceed
$20,000).
I. SAMPLE SCOPE OF WORK
1. Planning
a. Prepare a 12 month communication plan (including measurable objectives,
overarching messages/themes, audiences, strategies and tactics). Prepare a 12
month work plan describing implementation deliverables and timing. For the
purpose of budgeting, consultants can assume city staff have gained
consensus on an overall goal for the communication program. Review and
propose needed modifications to existing policies, procedures and guidelines
(such as the 2003 Press Policy & Public Information Manual and the 2015
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Public Engagement and Noticing Manual).
2. Content Creation and Community/Media Outreach
a. Create public information as needed for city issues, events, projects and
services including writing news releases, articles, website content, fact sheets
and other informational materials.
b. Assist with scheduling of, and participation in, community and media
outreach.
c. Identify and develop various outreach methods to enhance community
engagement and education of external and internal audiences.
d. For the purpose of budgeting, please provide a typical cost for:
i. 10 news releases describing action taken on a complex policy issue,
including research and quotes from city staff, council members
and/or community members as appropriate.
ii. 12 news releases promoting city events, public meetings, services
and other day to day public information topics. These releases will
become templates that can be used annually or as needed.
iii. 10, 2-page fact sheets on city issues (does not include graphic
design)
iv. 6 PowerPoint presentations on city issues and/or services. For
budgeting, assume presentations are 20 minutes. City will provide
PowerPoint template and images, as needed.
3. Communication and Media Outreach Training
a. Provide training for City employees on communications and media outreach
skills. For budgeting purposes, please provide a cost for:
i. Developing and delivering three, two-hour trainings (for 15 city
employees each) on:
ii. Effective message delivery (how to avoid jargon, using simple
messages, etc.)
iii. Spokesperson training (on camera practice of message delivery for at
least eight employees)
iv. Writing effective public information (focus on clear, concise, active
writing style)
4. Strategic Counsel
a. Provide ongoing strategic counsel to city staff, as needed, on issues, programs
and plan implementation.
5. Emergency Communications
a. As needed, assist with emergency communication services, including serving
as support in the city’s Emergency Operations Center during an emergency
incident (could involve work outside normal business hours). As a part of the
proposal, please provide the hourly rate associated with this task, if different
from standard rates.
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6. Optional Services
a. See Section IV, Optional Services
II. QUALIFICATIONS
The consultant is required to state what work of a similar character has been successfully
performed to that included in the sample scope of work and to give references, with telephone
numbers and addresses, which will enable the City to judge the vendor’s responsibility,
experience and skill, and business standing. The consultant is required to provide a minimum of
three (3) references where work was performed within the past five (5) years of a similar nature
to this contract.
III. OPTIONAL SERVICES
In addition to those items listed in Section II, Sample Scope of Services, there are services the
City may desire to use depending on the availability, quality and price of the service offered.
Proposals are not required to address optional services in order to be considered an acceptable
proposal. Final selection, however, of the successful proposal may be based on the ability of the
consultant to provide these services at an acceptable price as determined by the City.
a. Professional photography to assist in communicating about city issues, programs
and services. (Price should include granting city unlimited rights to images)
b. Graphic design services to produce print materials such as fact sheets,
infographics and informational brochures.
c. Professional videography to assist in communicating about city issues, programs
and services. (Price should include granting city unlimited rights to videos)
IV. ADDITIONAL SERVICES
If there are related services not otherwise identified in the City’s RFP, the proposer may offer
those to the City. Proposals are not required to address any additional services in order to be
considered an acceptable proposal. However, final selection of the successful proposer may be
based on the desirability of the additional services offered.
V. REFERENCE MATERIALS
The City has already developed several guidelines and templates related to communications. The
following should be carefully considered and integrated into the proposal:
1. Branding and Style Guide
2. Public Engagement and Noticing Manual
3. Press Policy and Public Information Manual
VI. ADDITIONAL CONSIDERATIONS AND ASSUMPTIONS
a. All works submitted to and accepted by the City must be an original piece created
by the contractor.
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b. All works submitted by the Contractor must be in standard U.S. English and
adhere to the Branding and Style Guide.
c. All works must be submitted in Microsoft Word format and include a headline
pertaining to the work in bold. The work should appear in a non-bolded Calibri,
12 point font.
d. The City reserves the right to use all submitted works in current and/or future
forms of current media and/or media to be developed.
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Section B
GENERAL TERMS AND CONDITIONS
PROPOSAL REQUIREMENTS
1. Requirement to Meet All Provisions. Each individual or firm submitting a proposal (proposer)
shall meet all of the terms, and conditions of the Invitation for Bids (IFB) or Request for
Proposals (RFP) specifications package. By virtue of its proposal submittal, the proposer
acknowledges agreement with and acceptance of all provisions of the IFB/RFP specifications.
2. Proposal Submittal. Each proposal must be submitted on the form(s) provided in the
specifications and accompanied by any other required submittals or supplemental materials.
Proposal documents shall be enclosed in an envelope that shall be sealed and addressed to the
Department of Finance, City of San Luis Obispo, 990 Palm Street, San Luis Obispo, CA, 93401.
In order to guard against premature opening, the proposal should be clearly labeled with the
proposal title, specification number, name of proposer, and date and time of proposal opening.
No FAX submittals will be accepted.
3. Insurance Certificate. Each proposal must include a certificate of insurance showing:
a. The insurance carrier and its A.M. Best rating.
b. Scope of coverage and limits.
c. Deductibles and self-insured retention.
The purpose of this submittal is to generally assess the adequacy of the proposer’s insurance
coverage during proposal evaluation; as discussed under paragraph 12 below, endorsements are
not required until contract award. The City’s insurance requirements are detailed in Section E.
4. Proposal Quotes and Unit Price Extensions. The extensions of unit prices for the quantities
indicated and the lump sum prices quoted by the proposer must be entered in figures in the
spaces provided on the Proposal Submittal Form(s). Any lump sum bid shall be stated in figures.
The Proposal Submittal Form(s) must be totally completed. If the unit price and the total amount
stated by any proposer for any item are not in agreement, the unit price alone will be considered
as representing the proposer's intention and the proposal total will be corrected to conform to the
specified unit price.
5. Proposal Withdrawal and Opening. A proposer may withdraw its proposal, without prejudice
prior to the time specified for the proposal opening, by submitting a written request to the
Director of Finance for its withdrawal, in which event the proposal will be returned to the
proposer unopened. No proposal received after the time specified or at any place other than that
stated in the "Notice Inviting Bids/Requesting Proposals" will be considered. All proposals will
be opened and declared publicly. Proposers or their representatives are invited to be present at
the opening of the proposals.
6. Submittal of One Proposal Only. No individual or business entity of any kind shall be allowed
to make or file, or to be interested in more than one proposal, except an alternative proposal
when specifically requested; however, an individual or business entity that has submitted a sub -
proposal to a proposer submitting a proposal, or who has quoted prices on materials to such
proposer, is not thereby disqualified from submitting a sub-proposal or from quoting prices to
other proposers submitting proposals.
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7. Cooperative Purchasing. During the term of the contract, the successful proposer will extend
all terms and conditions to any other local governmental agencies upon their request. These
agencies will issue their own purchase orders, will directly receive goods or services at their
place of business and will be directly billed by the successful proposer.
8. Communications. All timely requests for information submitted in writing will receive a
written response from the City. Telephone communications with City staff are not encouraged,
but will be permitted. However, any such oral communication shall not be binding on the City.
CONTRACT AWARD AND EXECUTION
9. Proposal Retention and Award. The City reserves the right to retain all proposals for a period
of 60 days for examination and comparison. The City also reserves the right to waive
non-substantial irregularities in any proposal, to reject any or all proposals, to reject or delete one
part of a proposal and accept the other, except to the extent that proposals are qualified by
specific limitations. See the "special terms and conditions" in Section C of these specifications
for proposal evaluation and contract award criteria.
10. Competency and Responsibility of Proposer. The City reserves full discretion to determine
the competence and responsibility, professionally and/or financially, of proposers. Proposers
will provide, in a timely manner, all information that the City deems necessary to make such a
decision.
11. Contract Requirement. The proposer to whom award is made (Contractor) shall execute a
written contract with the City within ten (10) calendar days after notice of the award has been
sent by mail to it at the address given in its proposal. The contract shall be made in the form
adopted by the City and incorporated in these specifications.
12. Insurance Requirements. The Contractor shall provide proof of insurance in the form,
coverages and amounts specified in Section E of these specifications within 10 (ten) calendar
days after notice of contract award as a precondition to contract execution.
13. Business Tax. The Contractor must have a valid City of San Luis Obispo business tax certificate
before execution of the contract. Additional information regarding the City's business tax
program may be obtained by calling (805) 781-7134.
CONTRACT PERFORMANCE
14. Ability to Perform. The Contractor warrants that it possesses, or has arranged through
subcontracts, all capital and other equipment, labor, materials, and licenses necessary to carry out
and complete the work hereunder in compliance with any and all federal, state, county, city, and
special district laws, ordinances, and regulations.
15. Laws to be Observed. The Contractor shall keep itself fully informed of and shall observe and
comply with all applicable state and federal laws and county and City of San Luis Obispo
ordinances, regulations and adopted codes during its performance of the work.
16. Payment of Taxes. The contract prices shall include full compensation for all taxes that the
Contractor is required to pay.
17. Permits and Licenses. The Contractor shall procure all permits and licenses, pay all charges
and fees, and give all notices necessary.
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18. Safety Provisions. The Contractor shall conform to the rules and regulations pertaining to
safety established by OSHA and the California Division of Industrial Safety.
19. Public and Employee Safety. Whenever the Contractor's operations create a condition
hazardous to the public or City employees, it shall, at its expense and without cost to the City,
furnish, erect and maintain such fences, temporary railings, barricades, lights, signs and ot her
devices and take such other protective measures as are necessary to prevent accidents or damage
or injury to the public and employees.
20. Preservation of City Property. The Contractor shall provide and install suitable safeguards,
approved by the City, to protect City property from injury or damage. If City property is injured
or damaged resulting from the Contractor's operations, it shall be replaced or restored at the
Contractor's expense. The facilities shall be replaced or restored to a condition a s good as when
the Contractor began work.
21. Immigration Act of 1986. The Contractor warrants on behalf of itself and all subcontractors
engaged for the performance of this work that only persons authorized to work in the United
States pursuant to the Immigration Reform and Control Act of 1986 and other applicable laws
shall be employed in the performance of the work hereunder.
22. Contractor Non-Discrimination. In the performance of this work, the Contractor agrees that it
will not engage in, nor permit such subcontractors as it may employ, to engage in discrimination
in employment of persons because of age, race, color, sex, national origin or ancestry, sexual
orientation, or religion of such persons.
23. Work Delays. Should the Contractor be obstructed or delayed in the work required to be done
hereunder by changes in the work or by any default, act, or omission of the City, or by strikes,
fire, earthquake, or any other Act of God, or by the inability to obtain materials, equipment, or
labor due to federal government restrictions arising out of defense or war programs, then the time
of completion may, at the City's sole option, be extended for such periods as may be agreed upon
by the City and the Contractor. In the event that there is insufficient time to gran t such
extensions prior to the completion date of the contract, the City may, at the time of acceptance of
the work, waive liquidated damages that may have accrued for failure to complete on time, due to
any of the above, after hearing evidence as to the reasons for such delay, and making a finding as
to the causes of same.
24. Payment Terms. The City's payment terms are 30 days from the receipt of an original invoice
and acceptance by the City of the materials, supplies, equipment or services provided by the
Contractor (Net 30).
25. Inspection. The Contractor shall furnish City with every reasonable opportunity for City to
ascertain that the services of the Contractor are being performed in accordance with the
requirements and intentions of this contract. All work done and all materials furnished, if any,
shall be subject to the City's inspection and approval. The inspection of such work shall not
relieve Contractor of any of its obligations to fulfill its contract requirements.
26. Audit. The City shall have the option of inspecting and/or auditing all records and other written
materials used by Contractor in preparing its invoices to City as a condition precedent to any
payment to Contractor.
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27. Interests of Contractor. The Contractor covenants that it presently has no interest, and shall
not acquire any interest—direct, indirect or otherwise—that would conflict in any manner or
degree with the performance of the work hereunder. The Contractor further covenants that, in
the performance of this work, no subcontractor or person having such an interest shall be
employed. The Contractor certifies that no one who has or will have any financial interest in
performing this work is an officer or employee of the City. It is hereby expressly agreed that, in
the performance of the work hereunder, the Contractor shall at all times be deemed an
independent contractor and not an agent or employee of the City.
28. Hold Harmless and Indemnification. The Contractor agrees to defend, indemnify, protect
and hold the City and its agents, officers and employees harmless from and against any and
all claims asserted or liability established for damages or injuries to any person or property,
including injury to the Contractor's employees, agents or officers that arise from or are
connected with or are caused or claimed to be caused by the acts or omissions of the
Contractor, and its agents, officers or employees, in performing the work or services herein,
and all expenses of investigating and defending against same; provided, however, that the
Contractor's duty to indemnify and hold harmless shall not include any claims or liability
arising from the established sole negligence or willful misconduct of the City, its agents,
officers or employees.
29. Contract Assignment. The Contractor shall not assign, transfer, convey or otherwise dispose of
the contract, or its right, title or interest, or its power to execute such a contract to any individual
or business entity of any kind without the previous written consent of the City.
30. Termination. If, during the term of the contract, the City determines that the Contractor is not
faithfully abiding by any term or condition contained herein, the City may notify the Contractor
in writing of such defect or failure to perform. This notice must give the Co ntractor a 10 (ten)
calendar day notice of time thereafter in which to perform said work or cure the deficiency.
If the Contractor has not performed the work or cured the deficiency within the ten days
specified in the notice, such shall constitute a breach of the contract and the City may terminate
the contract immediately by written notice to the Contractor to said effect. Thereafter, neither
party shall have any further duties, obligations, responsibilities, or rights under the contract
except, however, any and all obligations of the Contractor's surety shall remain in full force and
effect, and shall not be extinguished, reduced, or in any manner waived by the termination
thereof.
In said event, the Contractor shall be entitled to the reasonable value of its services performed
from the beginning date in which the breach occurs up to the day it received the City's Notice of
Termination, minus any offset from such payment representing the City's damages from such
breach. "Reasonable value" includes fees or charges for goods or services as of the last
milestone or task satisfactorily delivered or completed by the Contractor as may be set forth in
the Agreement payment schedule; compensation for any other work, services or goods performed
or provided by the Contractor shall be based solely on the City's assessment of the value of the
work-in-progress in completing the overall workscope.
The City reserves the right to delay any such payment until completion or confirmed
abandonment of the project, as may be determined in the City's sole discretion, so as to permit a
full and complete accounting of costs. In no event, however, shall the Contractor be entitled to
receive in excess of the compensation quoted in its proposal.
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Section C
SPECIAL TERMS AND CONDITIONS
1. Contract Award. Subject to the reservations set forth in Paragraph 9 of Section B (General
Terms and Conditions) of these specifications, the contract will be awarded to the lowest
responsible, responsive proposer.
2. Sales Tax Reimbursement. For sales occurring within the City of San Luis Obispo, the City
receives sales tax revenues. Therefore, for bids from retail firms located in the City at the time
of proposal closing for which sales tax is allocated to the City, 1% of the taxable amou nt of the
bid will be deducted from the proposal by the City in calculating and determining the lowest
responsible, responsive proposer.
3. Labor Actions. In the event that the successful proposer is experiencing a labor action at the
time of contract award (or if its suppliers or subcontractors are experiencing such a labor action),
the City reserves the right to declare said proposer is no longer the lowest responsible, responsive
proposer and to accept the next acceptable low proposal from a proposer that is not experiencing
a labor action, and to declare it to be the lowest responsible, responsive proposer.
4. Failure to Accept Contract. The following will occur if the proposer to whom the award is
made (Contractor) fails to enter into the contract: the award will be annulled; any bid security
will be forfeited in accordance with the special terms and conditions if a proposer's bond or
security is required; and an award may be made to the next lowest responsible, responsive
proposer who shall fulfill every stipulation as if it were the party to whom the first award was
made.
5. Contract Term. The supplies or services identified in this specification will be used by the City
between August 2016 and December 2016. The prices quoted for these items must be valid for
the entire period indicated above unless otherwise conditioned by the proposer in its proposal.
6. Contract Extension. The term of the contract may be extended by mutual consent for an
additional one-year timeframe.
7. Supplemental Purchases. Supplemental purchases may be made from the successful proposer
during the contract term in addition to the items listed in the Detail Proposal Submittal Form.
For these supplemental purchases, the proposer shall not offer prices to the City in excess of the
amounts offered to other similar customers for the same item. If the proposer is willing to offer
the City a standard discount on all supplemental purchases from its generally prevailing or
published price structure during the contract term, this offer and the amount of discount on a
percentage basis should be provided with the proposal submittal.
8. Contractor Invoices. The Contractor may deliver either a monthly invoice to the City with
attached copies of detail invoices as supporting detail , or in one lump-sum upon completion.
9. Non-Exclusive Contract. The City reserves the right to purchase the items listed in the Detail
Proposal Submittal Form, as well as any supplemental items, from other vendors during the
contract term.
10. Unrestrictive Brand Names. Any manufacturer's names, trade names, brand names or catalog
numbers used in the specifications are for the purpose of describing and establishing general
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quality levels. Such references are not intended to be restrictive. Proposals will be considered
for any brand that meets or exceeds the quality of the specifications given for any item. In the
event an alternate brand name is proposed, supplemental documentation shall be provided
demonstrating that the alternate brand name meets or exceeds the requireme nts specified herein.
The burden of proof as to the suitability of any proposed alternatives is upon the proposer, and
the City shall be the sole judge in making this determination.
11. Delivery. Prices quoted for all supplies or equipment to be provided under the terms and
conditions of this RFP package shall include delivery charges, to be delivered F.O.B. San Luis
Obispo by the successful proposer and received by the City within 90 days after authorization to
proceed by the City.
12. Start and Completion of Work. Work on this project shall begin immediately after contract
execution and shall be completed within 90 calendar days thereafter, unless otherwise negotiated
with City by mutual agreement.
13. Change in Work. The City reserves the right to change quantities of any item after contract
award. If the total quantity of any changed item varies by 25% or less, there shall be no change
in the agreed upon unit price for that item. Unit pricing for any quantity changes per item in
excess of 25% shall be subject to negotiation with the Contractor.
14. Submittal of References. Each proposer shall submit a statement of qualifications and
references on the form provided in the RFP package.
15. Statement of Contract Disqualifications. Each proposer shall submit a statement regarding
any past governmental agency bidding or contract disqualifications on the form provided in the
RFP package.
16. Proposal Content. Your proposal must include the following information:
Submittal Forms
a. Proposal submittal summary.
b. Certificate of insurance.
c. References from at least three organizations for whom you have provided similar
services.
d. Professional work product samples.
Qualifications
a. Experience of your firm in performing similar services. Provide a minimum of three case
studies/examples including the project goal, strategies and tactics, budget and results.
Include the names and roles of any staff who worked on those projects and would also
for on this contract.
b. Resumes of the individuals who would be assigned to this project, inclu ding any sub-
consultants. For each staff member, indicate the role on this project, the location of the
office where the person is based and the percentage of time that would be allocated to
this contract. Provide two references for each staff person (if different from references
provided as part of the firm’s experience).
c. Hourly billing rates for the assigned staff, including any sub -consultants. Rates must
reflect the City’s commitment to the responsible use of taxpayer money.
d. Statement and explanation of any instances where your firm has been removed from a
project or disqualified from proposing on a project.
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Work Program
e. Description of your approach to completing each task in the scope of work.
f. Sample budget for the following tasks, based on the direction provided in the scope of
work (the purpose of this budget is to enable the City to compare costs of defined tasks
among firms responding to this RFP. It is anticipated that other tasks will be added to the
scope of work, based on the communication plan that is developed and available
resources. The total cost of the contract will be $139,500, and the City desires to derive
maximum value for this budget.
Prepare a 12 month work plan describing implementation deliverables and
timing. For the purpose of budgeting, consultants can assume city staff
have gained consensus on an overall goal for the communication program.
10 news releases describing action taken on a complex policy issue,
including research and quotes from city staff, council members and/or
community members as appropriate.
12 news releases promoting city events, public meetings, services and
other day to day public information topics. These releases will become
templates that can be used annually or as needed.
10, 2-page fact sheets on city issues (does not include graphic design)
6 PowerPoint presentations on city issues and/or services. For budgeting,
assume presentations are 20 minutes. City will provide PowerPoint
template and images, as needed.
Effective message delivery training (how to avoid jargon, using simple
messages, etc.)
Spokesperson training (on camera practice of message delivery for up to
eight employees)
Writing for public information training (focus on clear, concise, active
writing style)
Graphic design for one two-page fact sheet.
Photography for one two-hour city event (approximately 50 high quality
images produced)
g. All other anticipated costs (travel time/expenses, if applicable, photocopying, telephone
charges, etc.). Assume city will cover printing and distribution of materials. Note any
agency mark up on expenses.
h. Services or data to be provided by the City.
i. Any other information that would assist us in making this contract award decision.
Proposal Length and Copies
j. Proposals should include numbered pages, including identification of attachments and
supplemental materials.
k. Three copies of the proposal must be submitted.
2. Proposal Evaluation and Consultant Selection. Proposals will be evaluated by a review
committee using a two-phase selection and contract award process as follows:
Phase 1 – Written Proposal Review/Finalist Candidate Selection
A group of finalist candidates will be selected for follow -up interviews and presentations based
on the following criteria as evidenced in their written proposals:
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a. Understanding of the work required by the City.
b. Quality, clarity and responsiveness of the proposal.
c. Demonstrated competence and professional qualifications necessary for successfully
performing the work required by the City.
d. Recent experience in successfully performing similar services.
e. Proposed approach in completing the work.
f. References.
g. Background and experience of the specific individuals to be assigned to this project.
h. Cost
Phase 2 – Oral Presentations/Interviews and Consultant Selection
Finalist candidates will make an oral presentation to the review committee and answer questions
about their proposal. The purpose of this second phase is two -fold: to clarify and resolve any
outstanding questions or issues about the proposal; and to evaluate the proposer’s ability to
clearly and concisely present information orally. As part of this second phase of the selection
process, finalist candidates will submit proposed compensation costs for the work, including a
proposed payment schedule tied to accomplishing key project milestones or tasks. After
evaluating the proposals and discussing them further with the finalists or the tentatively selected
contractor, the City reserves the right to further negotiate the proposed workscope and/or method
and amount of compensation.
Contract award will be based on a combination of factors that represent the best overall value for
completing the workscope as determined by the City, including: the written proposal criteria
described above; results of background and reference checks; results from the interviews and
presentations phase; and proposed compensation.
3. Proposal Review and Award Schedule. The following is an outline of the anticipated schedule
for proposal review and contract award:
a. Issue RFP 7/20/16
b. Receive proposals 8/3/16
c. Complete proposal evaluation 8/5/16
d. Conduct finalist interviews 8/12/16
e. Finalize staff recommendation 8/15/16
f. Award contract 8/19/16
g. Execute contract 8/26/16
h. Start work 8/30/16
4. Ownership of Materials. All original drawings, plan documents and other materials prepared
by or in possession of the Contractor as part of the work or services under these specifications
shall become the permanent property of the City, and shall be delivered to the City upon demand.
5. Release of Reports and Information. Any reports, information, data, or other material given
to, prepared by or assembled by the Contractor as part of the work or services under these
specifications shall be the property of City and shall not be made available to any individual or
organization by the Contractor without the prior written approval of the City.
6. Copies of Reports and Information. If the City requests additional copies of reports, drawings,
specifications, or any other material in addition to what the Contractor is required to furnish in
limited quantities as part of the work or services under these specifications, the Contractor shall
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provide such additional copies as are requested, and City shall compensate the Contractor for the
costs of duplicating of such copies at the Contractor's direct expense.
7. Alternative Proposals. The proposer may submit an alternative proposal (or proposals) that it
believes will also meet the City's project objectives but in a different way. In this case, the
proposer must provide an analysis of the advantages and disadvantages of each of the
alternatives, and discuss under what circumstances the City would prefer one alternative to the
other(s). If an alternative proposal is submitted, the maximum length of the proposal may be
expanded proportionately by the number of alternatives submitted.
8. Accuracy of Specifications. The specifications for this project are believed by the City to be
accurate and to contain no affirmative misrepresentation or any concealment of fact. Proposers
are cautioned to undertake an independent analysis of any test results in the specifications, as
City does not guaranty the accuracy of its interpretation of test results contained in the
specifications package. In preparing its proposal, the proposer and all subcontractors named in
its proposal shall bear sole responsibility for proposal preparation errors resulting from any
misstatements or omissions in the plans and specifications that could easily have been
ascertained by examining either the project site or accurate test data in the City's possession.
Although the effect of ambiguities or defects in the plans and specifications will be as
determined by law, any patent ambiguity or defect shall give rise to a duty of proposer to inquire
prior to proposal submittal. Failure to so inquire shall cause any such ambiguity or defect to be
construed against the proposer. An ambiguity or defect shall be considered patent if it is of such
a nature that the proposer, assuming reasonable skill, ability and diligence on its part, knew or
should have known of the existence of the ambiguity or defect. Furthermore, failure of the
proposer or subcontractors to notify City in writing of specification or plan defects or
ambiguities prior to proposal submittal shall waive any right to assert said defects or ambiguities
subsequent to submittal of the proposal.
To the extent that these specifications constitute performance specifications, the City shall not be
liable for costs incurred by the successful proposer to achieve the project’s objective or standard
beyond the amounts provided there for in the proposal.
In the event that, after awarding the contract, any dispute arises as a result of any actual or
alleged ambiguity or defect in the plans and/or specifications, or any other matter whatsoever,
Contractor shall immediately notify the City in writing, and the Contractor and all subcontractors
shall continue to perform, irrespective of whether or not the ambiguity or defect is major,
material, minor or trivial, and irrespective of whether or not a change order, time extension, or
additional compensation has been granted by City. Failure to provide the hereinbefore described
written notice within one (1) working day of contractor's becoming aware of the facts giving rise
to the dispute shall constitute a waiver of the right to assert the causative role of the defect or
ambiguity in the plans or specifications concerning the dispute.
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Section D
FORM OF AGREEMENT
AGREEMENT
THIS AGREEMENT is made and entered into in the City of San Luis Obispo on [day, date, year] by and
between the CITY OF SAN LUIS OBISPO, a municipal corporation, hereinafter referred to as City, and
[CONTRACTOR’S NAME IN CAPITAL LETTERS], hereinafter referred to as Contractor.
W I T N E S S E T H:
WHEREAS, on [date], City invited requested proposals for Consultant Services for citywide
communications support, per Specification No. 91493.
WHEREAS, pursuant to said request, Contractor submitted a proposal that was accepted by City for said
Consultant Services for citywide communications support.
NOW THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter
contained, the parties hereto agree as follows:
1. TERM. The term of this Agreement shall be one year from the date this Agreement is made and
entered.
2. INCORPORATION BY REFERENCE. City Specification No. 91493 and Contractor's
proposal dated [date], are hereby incorporated in and made a part of this Agreement. To the extent that there are any
conflicts between the City’s specification and this Agreement and the Contractor’s proposal, the terms of the City’s
specification and this Agreement shall prevail, unless specifically agreed otherwise in writing signed by both parties.
3. CITY'S OBLIGATIONS. For providing Consultant Services for Citywide communications
support, as specified in this Agreement, City will pay and Contractor shall receive therefor compensation in a total
sum not to exceed [$ .00 ].
4. CONTRACTOR'S OBLIGATIONS. For and in consideration of the payments and agreements
hereinbefore mentioned to be made and performed by City, Contractor agrees with City to do everything required by
this Agreement and the said specification.
5. AMENDMENTS. Any amendment, modification or variation from the terms of this Agreement
shall be in writing and shall be effective only upon approval by the Council or City Manager of the City.
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6. COMPLETE AGREEMENT. This written Agreement, including all writings specifically
incorporated herein by reference, shall constitute the complete agreement between the parties hereto. No oral
agreement, understanding or representation not reduced to writing and specifically incorporated herein shall be of
any force or effect, nor shall any such oral agreement, understanding or representation be binding upon the parties
hereto.
7. NOTICE. All written notices to the parties hereto shall be sent by United States mail, postage
prepaid by registered or certified mail addressed as follows:
City City Clerk
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
Contractor Name
Address
8. AUTHORITY TO EXECUTE AGREEMENT. Both City and Contractor 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.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year
first above written.
ATTEST: CITY OF SAN LUIS OBISPO
________________________________ By:_____________________________________
City Clerk City Manager
APPROVED AS TO FORM: CONTRACTOR
________________________________ By: _____________________________________
City Attorney
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Section E
INSURANCE REQUIREMENTS
Consultant Services
The Contractor shall procure and maintain for the duration of the contract insurance against claims for
injuries to persons or damages to property which may arise from or in conn ection with the performance
of the work hereunder by the Contractor, its agents, representatives, employees or subcontractors.
Minimum Scope of Insurance. Coverage shall be at least as broad as:
1. Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001).
2. Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code
1 (any auto).
3. Workers' Compensation insurance as required by the State of California and Employer's Liability
Insurance.
4. Errors and Omissions Liability insurance as appropriate to the consultant's profession.
Minimum Limits of Insurance. Contractor shall maintain limits no less than:
1. General Liability: $1,000,000 per occurrence for bodily injury, personal injury an d property
damage. If Commercial General Liability or other form with a general aggregate limit is used,
either the general aggregate limit shall apply separately to this project/location or the general
aggregate limit shall be twice the required occurrence limit.
2. Automobile Liability: $1,000,000 per accident for bodily injury and property damage.
3. Employer's Liability: $1,000,000 per accident for bodily injury or disease.
4. Errors and Omissions Liability: $1,000,000 per occurrence.
Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared
to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such
deductibles or self-insured retentions as respects the City, its officers, officials, employees and
volunteers; or the Contractor shall procure a bond guaranteeing payment of losses and related
investigations, claim administration and defense expenses.
Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be
endorsed to contain, the following provisions:
1. The City, its officers, officials, employees, agents and volunteers are to be covered as insureds as
respects: liability arising out of activities performed by or on behalf of the Contractor; products
and completed operations of the Contractor; premises owned, occupied or used by the
Contractor; or automobiles owned, leased, hired or borrowed by the Contractor. The coverage
shall contain no special limitations on the scope of protection afforded to the City, its officers,
official, employees, agents or volunteers.
2. For any claims related to this project, the Contractor's insurance coverage shall be primary
insurance as respects the City, its officers, officials, employees, agents and volunteers. Any
insurance or self-insurance maintained by the City, its officers, officials, employees, agents or
volunteers shall be excess of the Contractor's insurance and shall not contribute with it.
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3. The Contractor's insurance shall apply separately to each insured against whom claim is made or
suit is brought, except with respect to the limits of the insurer's liability.
4. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be
suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty
(30) days' prior written notice by certified mail, return receipt requested, has been given to the
City.
Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of
no less than A:VII.
Verification of Coverage. Contractor shall furnish the City with a certificate of insurance showing
maintenance of the required insurance coverage. Original endorsements effectin g general liability and
automobile liability coverage required by this clause must also be provided. The endorsements are to be
signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be
received and approved by the City before work commences.
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PROPOSAL SUBMITTAL FORM Sample
The undersigned declares that she or he has carefully examined Specification No. 91493, which is hereby
made a part of this proposal; is thoroughly familiar with its contents; is aut horized to represent the
proposing firm; and agrees to perform the specified work for the following cost quoted in full:
Description Quantity Unit Price Total
TOTAL BASE PRICE
Other (provide detail below)
TOTAL $
Delivery of equipment to the City to be within 90 calendar days after contract execution and written
authorization to proceed.
Certificate of insurance attached; insurance company’s A.M. Best rating: __________________.
Firm Name and Address
Contact Phone
Signature of Authorized Representative
Date
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REFERENCES
Number of years engaged in providing the services included within the scope of the specifications under
the present business name: .
Describe fully the last three contracts performed by your firm that demonstrate your ability to provide the
services included with the scope of the specifications. Attach additional pages if required. The City
reserves the right to contact each of the references listed for additional information regarding your firm's
qualifications.
Reference No. 1
Customer Name
Contact Individual
Telephone & FAX number
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome
Reference No. 2
Customer Name
Contact Individual
Telephone & FAX number
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome
Reference No. 3
Customer Name
Contact Individual
Telephone & FAX number
Street Address
City, State, Zip Code
Description of services provided
including contract amount, when
provided and project outcome
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STATEMENT OF PAST CONTRACT DISQUALIFICATIONS
The proposer shall state whether it or any of its officers or employees who have a proprietary interest in
it, has ever been disqualified, removed, or otherwise prevented from bidding on, or completi ng a federal,
state, or local government project because of the violation of law, a safety regulation, or for any other
reason, including but not limited to financial difficulties, project delays, or disputes regarding work or
product quality, and if so to explain the circumstances.
Do you have any disqualification as described in the above paragraph to declare?
Yes No
If yes, explain the circumstances.
Executed on at _______________________________________ under penalty
of perjury of the laws of the State of California, that the foregoing is true and correct.
______________________________________
Signature of Authorized Proposer Representative
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blank.
Meeting Date: 7/19/2016
FROM: Michael Codron, Director of Community Development
Prepared By: Rebecca Cox, Supervising Administrative Assistant
SUBJECT: LEASE AGREEMENT FOR 999 MONTEREY ST, SUITE 345
RECOMMENDATION
Approve and authorize the City Manager to execute a lease agreement in a form subject to the
approval of the City Attorney for 2,000 square feet of office space at 999 Monterey St, Suite 345
between the City of San Luis Obispo and Jamestown Premier SLO Retail, L.P.
DISCUSSION
The Community Development Department (CDD) requests approval of the lease of 2,000 square
feet of office space located at 999 Monterey Street, Suite 345, in the Court Street project. The
space will accommodate eight to 12 employees for a period of three years. Funding for the lease
was approved in the department’s 2016-17 fiscal year budget, as part of the 2015-17 Financial
Plan Supplement. As discussed in the Significant Operating Program Change (SOPC) presented
with the Supplement, the proposed change will free up space at the City’s 919 Palm Street
offices to accommodate growth in development review and code enforcement activities. In
addition, the change will enable the City to establish a one-stop shop at 919 Palm (during this
calendar year) to improve customer service and increase the quality of applications submitted to
building and planning.
The growth in development review activity has required CDD to increase its staffing resources to
provide timely service, such as subdivision plan reviews, processing of architectural review
applications, and building permit plan check and inspections. To address this growth in work
activity, the City Council approved the conversion of six temporary employees to regular, full-
time positions, and provided funding to maintain six other temporary staff members as part of the
2015-17 Financial Plan. In addition, CDD was approved for four additional temporary staffing
positions as part of the 2016-17 Financial Plan Supplement. In total, between CDD and Public
Works, there will be 23 additional temporary and regular staff working at 919 Palm than there
was when the building first opened its doors.
The proposed lease is a temporary solution to allow time for a reconfiguration of the 919 Palm
Street offices to occur, or for other alternatives to be developed. Community Development and
Public Works is working with the architectural firm Ravett Albrecht to prepare an analysis of
existing office spaces. The study will make recommendations for reconfigurations that can
accommodate staff in more productive work environments, where shared work spaces are
supported by additional resources such as access to private workstations for focus work, and
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additional conference and break-out rooms. In addition, the City Council approved a major space
needs analysis as part of the 2015-17 Financial Plan Supplement that will inform the City’s long
term office space planning.
FISCAL IMPACT
Staff has negotiated a cost of $2,500 per month for the 2,000 square foot lease space ($1.25 per
square foot). Total cost for lease space is $31,800 in 2016-17, $31,800 in 2017-18, and $31,800
in 2018-19, factoring in minor additional cost for electricity and water. The annual lease amount
will increase 3% in the second and third years of the lease. The total one time cost to span from
FY 16-17 to FY 18-19 is $95,400. The full cost will be offset by over realized revenues from
Development Services Fees. Funding for the lease was approved as part of the 2015-17 Financial
Plan Supplement, and as a result the resources are available in CDD’s budget for the 2016-17
fiscal year.
ALTERNATIVES
1. Deny or Defer Lease Agreement. The City Council may decide to not approve this lease and
continue the status quo. Denial of the request will continue the current situation where staff
are required to share space in “bullpen” configurations within the office at 919 Palm Street,
which impacts their ability to be productive and attentive to departmental priorities. In the
future, shared space is part of the plan for accommodating more bodies within the 919 Palm
Street office, however, those shared spaces will be supported by additional private work
spaces, collaboration spaces, and other features that enable an employee to be productive
during all phases of the work day.
2. Implementation in a Different Way. The study being prepared by Ravett Albrecht will
identify alternatives to plans for reconfiguration of 919 Palm Street, including use of the
Wellness Room in the Old Library, and/or reconfiguration of the downstairs offices at City
Hall. Ultimately, all of these alternatives may be necessary at some point to accommodate
future staffing needs. The larger space needs analysis approved by the City Council and
funded in Fiscal Year 2016-17 will provide additional recommendations for addressing the
City’s overall office space demand.
Attachments:
a - lease agreement
b - SOPC Lease Space
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Packet Pg. 37
6.a
Packet Pg. 38 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 39 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 40 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 41 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 42 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 43 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 44 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 45 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 46 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 47 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 48 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 49 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 50 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 51 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 52 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 53 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 54 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 55 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
6.a
Packet Pg. 56 Attachment: a - lease agreement (1415 : Court Street Lease Agreement)
SIGNIFICANT OPERATING PROGRAM CHANGE – COMMUNITY DEVELOPMENT
TEMPORARY LEASE SPACE TO ACCOMMODATE GROWTH AT 919 PALM
Summary of Change: The Community Development Department is proposing to lease 2,000 square feet of office space
located at 999 Monterey Street, Suite 345, in the Court Street project to accommodate 8-12 employees for a period of
three years.
Fiscal Impact: Staff has negotiated a cost of $2,500 per month for the 2,000 square foot lease space . One-time costs of
$50,000 are estimated to furnish the space and make information technology improvements such as cabling and an air -link
for data connectivity to City Hall. Total cost is $81,800 in 2016-17, $31,800 in 2017-18, and $31,800 in 2018-19. The
only additional expenditure outside of the monthly rent is for water and electricity, expected to total $1 50 per month or
$1,800 annually. The total one time cost to span from FY 16-17 to FY 18-19 will total $145,400. The full cost will be
offset by over realized revenues from Development Services Fees.
15/16
Forecast
15-16
Financial
Plan
Budgeted
Revenue
Forecasted
Revenue in
Excess of
Budget
Over Realized
Revenue
Eligible for
Appropriation
Appropriated
Development
Services
Balance
16/17 SOPC Requests Forecasted
Revenue in Excess
of Budget after
SOPCs
Staffing/Consultant Lease Space
$4,825,962 $3,734,000 $1,091,962 $818,972 $200,000 $661,423 $145,400 $212,149
Service Level Impact: The proposed change will enable space to be created at the 919 Palm Street office to
accommodate growth in development review and code enforcement activities. In addition, the change will enable the City
to establish a one-stop shop at 919 Palm to improve customer service and increase the quality of applications submitted to
building and planning.
KEY OBJECTIVES
1. Accommodate high levels of permit activity by freeing up space at 919 Palm Street to accommodate additional staff in
planning and building.
2. Implement a one-stop shop at 919 Palm Street to give project applicants access to the development review team to get
coordinated feedback on project proposals and definitive answers to key questions in advance of submitting an
application.
3. Allow time to design and construct a reconfiguration of 919 Palm Street to accommodate staff in a collaborative and
productive work environment.
EXISTING SITUATION: FACTORS DRIVING THE NEED FOR CHANGE
20 more employees than when the doors first opened, with more on the way.
As part of the 2015-17 Financial Plan, the City Council approved the conversion of six temporary employees to regular,
full-time positions, and provided funding to maintain six other temporary staff members – all in support of the
development review process. Revenue from development review activities continues to exceed projections and
Community Development is currently requesting three additional temporary staff to manage the workload. In addition, the
establishment of a Rental Housing Inspection Program added four full -time, regular positions to the department. In total,
Community Development has grown by 15 employees and Public Works has grown by 4 employees located at 919 since
the office space was first occupied.
Community Development is now requesting three additional temporary positions (see associated SOPC), and has initiated
plans to create a one-stop shop for permit services located at 919 to improve customer service and the quality of
applications submitted for review. These plans place additional demands on already impacted workspace at the 919 Palm
office space. The corresponding CIP project proposed to design reconfigured work space at 919 Palm will accommodate
this growth in a thoughtful and well-planned manner to ensure ongoing efficient and effective service to residents and
other customers.
6.b
Packet Pg. 57 Attachment: b - SOPC Lease Space (1415 : Court Street Lease Agreement)
SIGNIFICANT OPERATING PROGRAM CHANGE – COMMUNITY DEVELOPMENT
TEMPORARY LEASE SPACE TO ACCOMMODATE GROWTH AT 919 PALM
How have we accommodated the additional staff, and what are our plans to improve on that situation?
The changes made at 919 Palm Street to accommodate the increased staff have been primarily to create “bullpens” or
shared workstations that group as many as five employees where two workstations previously existed. This has resulted in
less than optimal working conditions for staff that spend much of their day analyzing, researching, and preparing reports
and recommendations. For staff that works in the field much of the day, time in the office is also important for conducting
research, important phone calls, and plan checking activities. While shared work spaces are an important part of future
plans for accommodating additional staff at 919 Palm, these should only occur where there are supportive facilities that
provide quiet work environments for focus work, collaborative areas that support group work and innovations, and shared
resources such as a library of code books so that space can be used more efficiently and effectively. Without these
features, staff working in the bullpens often feel trapped and unable to complete their work in a timely manner. The
proposal to relocate up to 12 staff members for a period of three years will enable design and construction of a new
concept for the layout of 919 Palm Street to occur without sacrificing a productive and supportive work environment.
Additional Benefits: One-Stop Shop Concept
The co-location of Community Development and Public Works at the 919 Palm offices has resulted in improvements in
communication and service delivery through the development review process. As the City has started to measure its
performance in the areas of building and planning permit services (e.g. plan check cycle times, percent of applications
deemed complete on first submittal), it has become apparent that changes are necessary to support improved performance
and increased customer service. One of the ways jurisdictions are able to improve performance in the area of building and
planning permitting is through the creation and implementation of a one-stop shop for permit services. The counter at 919
Palm was originally envisioned to perform this function, however, additional steps are necessary to fully support staff in
performance of plan check and permitting functions.
A working group made up of members of the City’s Development Oversight Committee and Development Review Team
is developing a program to provide this support to staff so that the associated customer service improvements can be
accomplished. The initial vision is to have all staff involved in development review activities (including planning,
building, and public right-of-way permits) convene at the one-stop shop up to four hours each week. During this period of
time, staff will work together on permit plan check activities, will meet with members of the public who are either
contemplating making an application or need additional information on a project already in plan check, and, staff will use
this time to participate in cross-training activities for the customer service team at the 919 counter. Mobile workstations
will provide staff located in the one-stop shop the ability to access the City’s network and complete normal work
assignments as if they were at their regular office location. It is also important to note that cross -training is seen as an
essential function of the one-stop shop to ensure consistent communication between customers and the customer service
team working at 919 Palm.
Accomplishing the one-stop shop will require retrofitting existing space within 919 Palm with mobile workstations and
plan check resources so that staff can accomplish all of the work they would normally complete at their desks in this new
resource area. The changes include additional network support, mobile computing hardware, and furniture modifications.
Interim Solution
With the approval of the proposed off-site lease space, an interim solution for the one-stop shop is possible in 919 Palm
using the existing area outside of the Chief Building Official’s office. This area is already configured in a way that will
enable collaborative work between six members of the development review team, allowing staff in the one-stop shop to
use mobile workstations and a shared plan check table to review plans, perform cross-training with staff at the public
counter, and meet with prospective applicants regarding their plans.
GOAL AND POLICY LINKS
This operating program change ties to previously adopted goals or policies including:
1. Identify and support ideas for continued improvement and development within the Community Development
Department (E-140).
6.b
Packet Pg. 58 Attachment: b - SOPC Lease Space (1415 : Court Street Lease Agreement)
SIGNIFICANT OPERATING PROGRAM CHANGE – COMMUNITY DEVELOPMENT
TEMPORARY LEASE SPACE TO ACCOMMODATE GROWTH AT 919 PALM
2. Continue to improve the development review process by implementing the recommendations of the Department’s
Organizational Assessment (E-145).
3. Implement a comprehensive performance management system to track the efficiency and effectiveness of permit
review (E-145).
4. Provide an in-house pre-application review process for applicants that have downtown complex mixed use
projects for code compliance as well as other applicants seeking advice and coordinate with other divisions as
needed (E-154).
PROGRAM WORK COMPLETED
On April 27, 2016, a preliminary report on how the City uses available space in 919 Palm, the lower level of City Hall, the
Old Library, and the Ludwick Center, was submitted by Ravatt Albrecht, an architectural firm that specializes in the
design of interior spaces. This work will inform the program, and ultimately the design of the reconfigured 919 Palm
office space. The report includes recommendations for a much more efficient layout of workspaces on the floor of 919
that will accommodate more people, support collaboration, and still provide employees with quiet work areas to
accomplish focus work.
ENVIRONMENTAL REVIEW
No environmental review required.
PROGRAM CONSTRAINTS AND LIMITATIONS
The lease space is being made available to the City for a three -year term. Three years is assumed to be sufficient time to
design, plan and implement a reconfiguration of the work space at 919. However, funding for a larger project is not
available at this time and will be dependent on other priorities. The project is constrained because after the three -year
period the staff working in the new lease space will be expected to move back to 919 Palm.
STAKEHOLDERS
Residents, property owners, and other community members who receive service from the Community Development
Department will be positively impacted by this change.
IMPLEMENTATION
Task Date
1. Execute Letter of Intent June 2016
2. Complete lease agreement July 2016
3. Implement moving plan July 2016
4. Occupy new lease space August 2016
KEY PROGRAM ASSUMPTIONS
Staff assumes that three years will be sufficient time to design and construct improvements at 919 Palm Street that will
allow for all staff to be accommodated within the existing work area.
PROGRAM MANAGER AND TEAM SUPPORT
Program Manager:
Community Development Director
6.b
Packet Pg. 59 Attachment: b - SOPC Lease Space (1415 : Court Street Lease Agreement)
SIGNIFICANT OPERATING PROGRAM CHANGE – COMMUNITY DEVELOPMENT
TEMPORARY LEASE SPACE TO ACCOMMODATE GROWTH AT 919 PALM
Project Team:
Community Development Department Management Group, including the Chief Building Official, Deputy Directors, and
Administrative Analyst.
Alternatives:
1. Continue the Status Quo. Denial of the request will continue the current situation where staff are required to share
space in “bullpen” configurations within the office at 919 Palm Street, which impacts their ability to be productive
and attentive to departmental priorities. In the future, shared space is part of the plan for accommodating more bodies
within the 919 Palm Street office, however, those shared spaces will be supported by additional private work spaces,
collaboration spaces, and other features that enable an employee to be productive during all phases of the work day.
2. Implementation in a Different Way. The Ravett Albrecht study has identified alternatives to the reconfiguration of
919 Palm Street, including use of the Wellness Room in the Old Library, reconfiguration of the downstairs offices at
City Hall. Ultimately, all of these alternatives may be necessary at some point to accommodate future staffing needs.
OPERATING PROGRAM
Community Development Administration (40100)
COST SUMMARY
ONGOING EXPENDITURES
Line item description PROGAM ACCOUNT #AMOUNT
STAFFING
CONTRACT SERVICES
OTHER OPERATING EXPENDITURES
MINOR CAPITAL
TOTAL ONGOING OPERATING CHANGE -$ -$
ONE-TIME EXPENDITURES
Line item description PROGRAM ACCOUNT #AMOUNT
STAFFING
CONTRACT SERVICES 40100 7227 90,000$
OTHER OPERATING EXPENDITURES 40100 7227 55,400$
MINOR CAPITAL
Revenue Offset Development Services Fee Revenue (145,400)$
TOTAL ONE-TIME OPERATING CHANGE -$
6.b
Packet Pg. 60 Attachment: b - SOPC Lease Space (1415 : Court Street Lease Agreement)
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blank.
Meeting Date: 7/19/2016
FROM: Shelly Stanwyck, Parks and Recreation Director
Prepared By: Melissa C. Mudgett, Parks and Recreation Manager
SUBJECT: CONSIDERATION OF THE PROPOSED CHANGES TO THE CITY’S
PUBLIC ART POLICY
RECOMMENDATION
As recommended by the Parks and Recreation Commission, review and approve proposed
changes to the City’s Public Art policies to include an update to the Utility Box Art program
specifying the program’s maintenance, replacement, expansion and archival of box art murals.
DISCUSSION
Background
In March 2015, the City Council approved updates to the City’s Public Art Policy to include the
Utility Box Art pilot program as an ongoing temporary public art project within the City’s Public
Art Program. In December 2015, consistent with the adopted policy for temporary public art,
Council approved funding for the 2016 Box Art Repainting project. While conducting the public
outreach and engagement for the 2016 Box Art Repainting project, the community provided
Council with input and recommended additional amendments to the public art policy for the Box
Art program. These amendments addressed maintenance, duration of mural exhibits, expansion
of the program and archival of the box art murals. In response to Council’s direction received on
February 22, 2016, the Box Art Stakeholders Group was formed to address these community
concerns and propose policy amendments for Council’s consideration. The Parks and Recreation
Commission reviewed the proposed amendments at its May 4, 2016 meeting (Meeting Minutes
provided as Attachment A) and recommended Council adoption of the City’s Public Art Policy
for the Utility Box Art program as proposed.
Utility Box Art Program
Initially conceived as a program to discourage and abate graffiti and to enhance unattractive
utility/traffic signal boxes at various high visibility intersections in the Downtown core, the
Utility Box Art Program received funding from the City Council in 2010 for sixteen downtown
utility boxes. The City, with the support of the San Luis Obispo Downtown Association and Arts
Obispo, initiated the Utility Box Art pilot project as part of the City’s Downtown Maintenance
and Beautification capital project. Widespread popularity of the box art program quickly grew
and enabled the pilot program to expand. A second phase of utility box art was rolled out in
2012, adding seventeen more utility boxes to the program. Currently, the Utility Box Art
Program has thirty-three painted boxes throughout the City (Box Art Map provided as
Attachment B).
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Box Art Stakeholders Group
The Box Art Stakeholders group consists of various City staff, artists and community
organization representatives. The Program Manager for Public Art facilitates the group, and they
met bi-weekly for the past several months to develop program and policy recommendations for
Council’s consideration (the Stakeholder Member list provided as Attachment C).
Summary of Proposed Box Art Program Changes
The purpose of the Temporary Public Art policy for Box Art is to encourage the creative uses of
public art on utility boxes throughout the community based on established guidelines. The
proposed Utility Box Art program modifications include updated policy language identifying
new parameters in support of providing ongoing maintenance and care, guidelines for mural
replacement, expansion of the box mural locations as well as guidelines for the archival of box
art murals that are officially removed from the program. The proposed additions to the Utility
Box Art program are summarized in the table below and are provided in greater detail as
Attachment D with the proposed policy language.
SUMMARY OF PROPOSED BOX ART PROGRAM CHANGES
FOCUS
CURRENT
PROPOSED
BENEFIT OF
ADDITIONAL
LANGUAGE
MAINTENANCE
Maintenance
program not
addressed in
current policy
Proposing both short & long-term
care for the preservation of artwork.
- Short Term: annual box
cleanings
- Longer Term: Contract with
artists for repairs when
needed & re-application of
protective UV coating every
3-5 years
-
Increases the mural "life"
for resident & visitor
enjoyment
DURATION
Duration of box
art murals to be 5
years
“Downtown Core", as defined by the
Downtown Association Map, to
repaint every 3-5 years as funding
permits
Other City locations (outside of
Downtown Core), to repaint every
10 years as funding permits
Repainting as determined by
Evaluation Criteria which includes
an evaluation of time, maintenance
needs, location of box (highly
visible areas) & public engagement
(consideration of public input when
determining mural replacement)
Using the adopted
evaluation criteria allows
flexibility in determining
the "life-span" of the box
art murals & repainting
More frequent rotation of
art in the “Downtown
Core” promotes vibrant
tourism & opportunities
for new emerging artists
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EXPANSION
Expansion of the
box art program not
addressed in
current policy
Expand Box Art to remaining blank
city-owned boxes. The proposed
Box Art expansion will use the
evaluation criteria which includes a
combination of community input,
public exposure, vandalism,
proximity to other public art & city
ownership to determine expansion
Public "voting" for boxes (in
combination w/ other evaluation
criteria) to prioritize remaining
boxes for painting
Seek partnership opportunities to
expand art murals on privately
owned boxes
Promotes public
participation in the art
process
Lays the foundation for
box art program growth
while meeting community
needs
ARCHIVAL
Archival of
artwork not
addressed in
current policy
Preservation of Box Art murals
shall be provided in both print &
electronic formats, in a way that
ensures artwork is accessible to the
public.
(Examples of archival methods
could include books, coloring
pages, postcards, website, database,
relocation of deaccessioned boxes
for continued public display, or
private purchase of signal cabinets
when removed from the box art
program etc.)
Establishes a program
legacy for public art
Program Next Steps
Modified Boxes
The Box Art Stakeholder Group recommends proceeding with program expansion of the art
murals to include the four (4) recently modified traffic signal box locations and the remaining
blank city-owned utility boxes first. The evaluation criteria, as proposed, includes the
consideration of mural replacement with new art when a significant portion of the original
artwork has been modified. Currently, there are four traffic signal box locations that have
received this battery backup unit modification to the front panel of the utility box. The battery
back-up unit is necessary to integrate the boxes into the City’s signal systems and provides a
continued power source in the event of a disruption (such as with a power outage) to prevent the
loss of data and productivity. The recently modified utility box locations (as provided in
Attachment E) have met this proposed replacement criteria and are being recommended for
consideration of new artwork as part of the next box art painting phase.
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Designated Areas
The Box Art Stakeholders group is proposing to designate two specific areas with defined
lifecycles for box art murals; the “Downtown Core” and “Other City Locations.” Box art murals
located within the “Downtown Core” (as identified in the Downtown Association’s Downtown
Boundary Map and provided as Attachment F) would be subject to a more frequent rotation of
artwork every 3-5 years. Box Art murals located outside of the downtown area in “Other City
Locations” would have a longer lifecycle of 10 years. All artwork would be evaluated against
the proposed box art mural replacement criteria which includes a combination of the following:
Community engagement for prioritizing the replacement of art murals
Level of exposure of the box art to pedestrian/vehicle/bicycle traffic
Maintenance needs; as result of repairs, relocation or vandalism
Proximity of the box art to other public art
Ownership of the utility box; city-owned versus private
Box Art murals meeting these criteria could be recommended for replacement as funding is
available.
Value of New Art Murals
As beloved as these box art pieces are, they were never intended to last forever. While it is true
that some of these art pieces have held up remarkable well given the high quality paints and the
protective UV coating used, the art will eventually succumb to the outdoor elements or
maintenance/repairs and require repainting. The evaluation criteria as proposed above provides
an assessment structure that allows for flexibility in determining the "life-span" of the box art
murals and repainting. The intent behind the two area designations as proposed by the Box Art
Stakeholders Group is to offer a healthy balance between keeping our beloved art murals a little
longer while promoting both tourism and community vibrancy with a more frequent rotation of
art murals.
A more frequent rotation of artwork in the “Downtown Core” would be alignment with the
City’s efforts to promote tourism, as well as create new opportunities for emerging artists to
generate art that is visible and accessible to the public. The nineteen utility box art murals
located in the “Downtown Core” are more susceptible to increased maintenance as a result of
higher pedestrian and vehicle traffic, graffiti and road grime caused by heavy vehicle traffic.
Boxes located in outside of the downtown core have less pedestrian and vehicle traffic making
these neighborhood locations conducive to an extended display of artwork with minimal
maintenance needed. Artists that desire to have their art murals on display for an extended
period of time could opt for locations outside of the downtown core area.
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Program Expansion
The City of San Luis Obispo owns and
operates a total of sixty-four (64) traffic
signal utility boxes. Of this amount, there
are still 31 blank city-owned traffic signal
utility box locations that can also be
prioritized for new art murals. A map of
city-owned traffic signal location and
future box art mural locations is provided
as Attachment G.
Consistent with the City’s adopted Public Engagement and Notification (PEN) Manual, the Bo x
Art Stakeholders group recommends using a unique public engagement voting opportunity to
seek community input in prioritizing the boxes for future painting phases. The “vote for the box”
public engagement opportunity will utilize “vote for me” signage on the remaining blank traffic
signal box locations. The number of votes a box receives, in addition to an evaluation against the
approved criteria (maintenance needs, high public areas, proximity to other public art, etc.), will
be used to develop a priority list for the remaining blank city traffic signal boxes to be painted. It
is anticipated that the painting of these new utility boxes could occur in phases over the next
three to seven years, as public art funding is available.
Once all city-owned utility boxes are painted with murals, the program will then focus on the
repainting the older, original boxes with new art murals. The repainting of the original utility box
art murals (currently in the “Downtown Core”) would not begin until after all of the city-owned
boxes have been painted out. This could mean that the utility boxes located in the “Downtown
Core” could be eligible for repainting as soon as 2019, or as late as 2023.
Program Schedule
Upon adoption of the policy recommendations, the Box Art Program will begin with an
evaluation of the utility boxes to prioritize maintenance, repairs and program expansion. The
location and total number of utility boxes to be painted and locations will be determined
following this public engagement and evaluation period; resulting in a painting priority order list
for the remaining blank utility boxes. Once locations for new box art have been identified, an
Art Jury will assemble to review design proposals and make selection recommendations to the
appropriate Advisory Bodies. The City Council will have the final consideration of box art
designs and locations prior to painting; which is anticipated for the late Fall/Winter. The revised
timeline for the 2016 Box Art Painting project is provided below.
Staff has confirmed compliance with the
City’s Municipal Code for signage, which
provides the lawful authority to the City for
placement of official program signage on the
traffic signal control boxes for the purpose of
this public engagement opportunity. Parks
and Recreation staff will continue to work
with the City’s Transportation and Streets
Division to develop the appropriate signage.
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CONCURRENCES
For the past several months a group of stakeholders interested in the box art program
(Attachment C) has worked to develop the proposed program amendments. Community
representatives of this stakeholders group concur with the policy language as proposed. The
Public Works Department staff has reviewed the recommended public art policy additions and
concurs with the recommendations included in this report. At its May 4, 2016 meeting, the Parks
and Recreation Commission provided input on proposed policy additions to the Box Art
Program. The Parks and Recreation Commission unanimously supported the additional Box Art
Program language.
ENVIRONMENTAL REVIEW
This project is not subject to environmental review because it is not a “project” within the
meaning of the California Environmental Quality Act. Alternatively, if the project is subject to
CEQA, the project is exempt from environmental review pursuant to CEQA Guidelines section
15601(b)(3) because it can be seen with certainty that there is no possibility that the activity in
question may have a significant effect on the environment.
FISCAL IMPACT
There is no General Fund fiscal impact associated with this update to the City’s Public Art
Policies to include new language addressing the ongoing art mural maintenance, replacement,
expansion and archival of Utility Box Art program murals. The total number of traffic signal
utility box murals painted with each phase will be dependent upon available monies in the Public
Art Fund and Council’s allocation of those funds for future box art painting projects. In
December 2015, Council approved $48,000 of Public Art Funds which will be used to support
the upcoming 2016 Box Art painting project.
ALTERNATIVES
1. Do not approve proposed Public Art policy changes. The City Council could decide not
to approve one or more of the proposed Public Art policy changes. In this case, direction
should be given to staff regarding the related issues and any other changes desired to the
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public art policies.
Attachments:
a - PRC Minutes 5.4.16
b - BoxArtMap
c - Box Art Stakeholder List
d - Amend to BoxArtPolicy2016
e - Modified Box Locations
f - DA Boundary Map
g - Box Art and Future Locations Map
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City of San Luis Obispo, Title, Subtitle
1
Ludwick Community Center
864 Santa Rosa Street
San Luis Obispo, CA 93401
Wednesday, May 4, 2016, 5:30 p.m.
CALL TO ORDER: Chair Whitener called the meeting to order at 5:31 p.m.
ROLL CALL: Chair Jeff Whitener, Commissioners Susan Olson, Douglas Single, Susan
Updegrove
ABSENT: None (Commissioner Single absent for Agenda items 3-6)
COUNCIL: John Ashbaugh
STAFF: Shelly Stanwyck, Melissa Mudgett, Jamie Bell, Amanda Golden (Designing
Local)
Public Comment
John Stocksdale, SLO Pickleball Club, asked for clarification of the Commission’s direction to staff at the
April 6th meeting. He asked when information following the sur vey will be provided. He urged the
Commission to allow pickleballers to the share in the use of French Park Tennis courts twice weekly. Director
Stanwyck responded that the sports court survey closed on April 30th and that staff is analyzing the data. She
reminded the Commission that SLO High School tennis courts will be under construction this summer/fall and,
as per the Joint Use Agreement, the School District shall have priority use of the Sinshiemer Tennis Courts.
This will result in an increased use of Islay and French Park tennis courts of contract classes, tennis lessons and
public tennis use during the summer/fall 2016. She anticipates that the Commission should receive the survey
results and staff recommendations by summer; possibly July/August.
Jean Hyduchak, SLO Pickleball Club, thanked the Commission for their support of Pickleball and asked for
increased playing time while the survey results are being analyzed. She asked the Commission to consider
increased days at Meadow Park Basketball Courts or French Park Tennis Courts. Chair Whitener responded
that an increase in pickleball play is not on the agenda and therefore no action could be taken. He reiterated
that the Commission will be awaiting the sports court survey results in the summer.
Michael Parolini, SLO resident, supported the Pickleball Pilot Program and felt the City has done a good job in
accommodating the Pickleballers needs in a short amount of time. He felt that tennis players and Pickleballers
could reasonably share the courts.
Mila Vujovich-La Barre, SLO Resident, spoke about the property at 71 Palomar. She urged the Commission
to support the City’s purchase of this property for use as a City park. She added that this property is currently
in escrow with a private developer and she would like to see the City make a counter -offer for purchase of this
property. Chair Whitener clarified that the purchase of propert y it outside the purview of the Parks and
Recreation Commission.
Cheryl McLean, SLO Resident, also spoke in favor of having the City purchase the property at 71 Palomar for
use as a city park; adding that this location is ideal for pedestrian access.
Meeting Minutes
Parks and Recreation Commission 7.a
Packet Pg. 68 Attachment: a - PRC Minutes 5.4.16 (1411 : Box Art Policy Amendments)
City of San Luis Obispo, Title, Subtitle
2
1. CONSIDERATION OF MINUTES OF REGULAR MEETING OF APRIL 6, 2016.
MOTION: (Olson/Updegrove) Approved the Minutes of April 6, 2016 as amended.
Approved: 4 yes: 0 no: 0 absent
2. COMMUNITY WORKSHOP AND INPUT ON DRAFT PUBLIC ART MASTER PLAN
(Golden)
The Parks and Recreation Commissioners joined the audience to directly participate in the workshop activities.
Director Stanwyck introduced the Public Art Master Planning consultant, Amanda Golden of Designing Local.
Ms. Golden provided an outline of the Community Workshop activities. She added that the PRC Community
Workshop was intended as an opportunity to share the draft Public Art Master Plan with community members
and for the Commissioners and public to provide feedback about the draft Master Plan and proposed
recommendations. She reminded the group that a survey is also available through the City’s Website Open
City Hall Forum through June 15th for those who wish to provide the Advisory Body with feedback.
Ms. Golden presented the draft Master plan recommendations which were developed to help maintain and
nurture the public art program in SLO and to maximize the effectiveness of the public art program. The
Community Workshop was designed to be interactive with feedback and discussion; therefore no action was
taken by the PRC. Instead, the public attending the Community Workshop provided the Commission and staff
with feedback on the following draft recommendations. A summary of this feedback is provided below:
a. Maintenance of the Public Art Collection. The public attending the community workshop supported
addressing short and long-term maintenance plans for the art pieces and provided feedback on the
types of maintenance plans and activities they would like to Commission to consider.
b. Funding Analysis. Input was provided in support of pursuing new and diverse funding opportunities
including grants, partnerships (with TBID, schools, Cal Poly), special arts districts, and incentive
programs.
c. Community Engagement/Marketing. Input was provided about various types of communication
and marketing strategies that would better promote the City’s public art program.
d. Public Art Review Process. Input was provided about process enhancements would the community
recommend to streamline the public art process such as a mentor program and developing a directory
of artists and services.
e. Dedicated Public Art “Resource”. Input was provided about the level of staffing resource needed to
support a growing public art program.
f. Other Ideas. The community group provided additional input and feedback for the Commission to
consider when determining the strategic direction and growth of public art programming.
Parks and Recreation Manager, Melissa Mudgett, shared that the next step in the process will be the PRC’s
review of the updated draft Master Plan and the community’s feedback (received both at the workshop and
through the Open City Hall survey) at its next meeting on July 6, 2016. City staff and Ms. Golden thanked the
community members for attending the workshop and providing valuable feedback.
3. CONSIDERATION OF PUBLIC ART POLICY ADDITIONS TO THE BOX ART PROGRAM
(Mudgett)
Parks and Recreation Manager, Melissa Mudgett, presented an overview of the proposed changes to the City’s
Public Art Policy for Utility Box Art. As part of the 2016 Box Art Repainting project, the City Council
7.a
Packet Pg. 69 Attachment: a - PRC Minutes 5.4.16 (1411 : Box Art Policy Amendments)
City of San Luis Obispo, Title, Subtitle
3
recommended staff return to the Council with additional amendments to the public art policy for the Box Art
program to address maintenance, duration of mural exhibits, expansion of the program and archival of the box
art murals. Staff Mudgett said that the Box Art Stakeholders Group (which consists of various City staff,
artists and community organization representatives) was formed in response to Council’s direction and the
policy additions recommended this evening are in support of these community concerns. She added that the
purpose of the Temporary Public Art policy for Box Art is to encourage the creative uses of public art on
utility boxes throughout the community based on established guidelines. Staff Mudgett summarized the
proposed Utility Box Art program policy language and reiterated that the new language helps identify
parameters when expanding box locations as well as guidelines for mural replacement, ongoing maintenance
and care, and the proper archival of deaccessioned box art murals.
Public Comment
Michael Parolini, SLO Resident, asked the Public Art Program staff to consider adding QR codes to the utility
boxes which would link the public to the City’s website and information about the artists and box art. Staff
Mudgett responded that this is currently under consideration.
Commission Comment
Commission Updegrove asked for clarification that the yellow highlighted areas were the recommended
additional policy language; which were not a part of the adopted policy prior. Staff Mudgett confirmed that
this was correct; the highlighted areas were the newly recommended policy additions.
Commissioner Updegrove asked for clarification of “archival” and “deaccessioned”. Staff Mudgett responded
that archival refers to the preservation of the art mural in both print and media form; deaccessioned refers to
the removal of the physical utility box from the City’s traffic signal system. Staff Mudgett added that a
glossary of terms is also provided as Attachment 3 to the staff report for further clarification. Commissioner
Updegrove thanked the Box Art Stakeholder Group for their efforts.
MOTION: (Updegrove/Olson) Recommend that the City Council adopts the proposed additions to the Public
Art Policy for the Utility Box Art Program.
Approved: 3 yes: 0 no: 1 absent (Commissioner Single)
4. DIRECTOR’S REPORT
Director Stanwyck provided a brief overview of current Parks and Recreation programming.
3 PRC Advisory Body vacancies
Monster Skate on May 21st
Currently recruiting and training for lifeguards
Rangers working on Reservoir Canyon Trails
Kindergarten registration a success on May 2nd
Golf Course Restroom Remodel project is completed. Ribbon Cutting event to be scheduled.
Jack House Elevator Removal and Restoration project is completed. Ribbon cutting
ceremony on May 10th at 3:00pm
5. SUBCOMMITTEE LIAISON REPORTS
Adult and Senior Programming: No Report.
Bicycle Advisory: No Report.
City Facilities (Damon Garcia, Golf, Pool & Joint Use Facilities): No Report.
Jack House Committee: Commissioner Updegrove reported that the Jack House Elevator
Restoration project is now complete with a ribbon cutting ceremony is planned for May 10th
at 3:00pm. Jack House Mother’s Day will be on Sunday, May 8th from 1-4:00pm. There
will be live music and if there are three generations of a family present, they can tour the
house for free.
Tree Committee: Commissioner Olson said there was nothing significant to report.
Youth Sports: No Report.
7.a
Packet Pg. 70 Attachment: a - PRC Minutes 5.4.16 (1411 : Box Art Policy Amendments)
City of San Luis Obispo, Title, Subtitle
4
6. COMMUNICATIONS
No other communications.
Adjourned at 8.17 pm to the Regular Meeting on June 1, 2016 at the City Council Chambers, 990 Palm
Street, San Luis Obispo at 5:30pm.
Approved by the Parks and Recreation Commission on June 1, 2016.
________________________________________________
Melissa C. Mudgett, Parks and Recreation Department Manager
7.a
Packet Pg. 71 Attachment: a - PRC Minutes 5.4.16 (1411 : Box Art Policy Amendments)
|SLO BOX ART
The City of San Luis Obispo invites artists and community members residing in
San Luis Obispo County to apply for the 2016 Box Art Repainting Project.
|the project
The City’s Box Art Program began in 2010 as a
creative way to deter graffiti. The goal of the Box Art
program was to use the utility boxes as “canvases”
for original art pieces. The Box Art has contributed to
the vitality and attractiveness of our community while
effectively deterring graffiti and adding to SLO’s “curb
appeal”. SLO Box Art is a streetscape showcase
for talented local artists and community members to
transform standard utility boxes into new public art-
works, adding to the vibrancy of our cityscape while
creating a sense of place and identity.
|More information: facebook.com/SLOPublicArt | Instagram: @slopublicart
Marsh
mill
Palm
pacific californiabuchon
BroadososBroadhiguera
chorrotoro1 santa rosanipomogardenmorro2
pismo
islaygardenchorro morroosossanta rosamonterey
monterey monterey
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i
fo
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afoothi
ll
torochurch
upham
hig
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Marsh
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higuerahiguera johnsonpeppergrand31 8
26
15
30
19
21
32 28
18
14
7
3
11
10
1620
23
4
29
22
6
25
17
9
27
12
24
13
5
Current Box art locations
Madonna
Marsh 33
7.b
Packet Pg. 72 Attachment: b - BoxArtMap (1411 : Box Art Policy Amendments)
City of San Luis Obispo, Parks and Recreation, 1341 Nipomo Street, San Luis Obispo, CA, 93401-3934, 805.781.7300, slocity.org
2016 BOX ART STAKEHOLDERS GROUP
MEMBER LIST
Name Representative
1. Melissa C. Mudgett City of San Luis Obispo, Public Art Program
2. Jamie Bell City of San Luis Obispo, Parks & Recreation Marketing
3. Barbara Lynch City of San Luis Obispo, Public Works (Box Maintenance)
4. Lt. Bill Proll City of San Luis Obispo, Police Department (Graffiti)
5. Dominic Tartaglia Downtown Association, Executive Director
6. Landy Fike The Tribune News & Downtown Design Committee
7. Charlene Rosales SLO Chamber of Commerce, Governmental Affairs
8. Aaron Gomez Local Business Owner & SLO Chamber Economic Vitality
Committee
9. Angela Tahti Arts Obispo, Executive Director
10. Allen Root Local Artist & ARC Advisory Body
11. Colleen Gnos Local Artist & former Artist for Box Art (Phase I)
12. Marcie Hawthorne Local Artist & former Artist for Box Art (Phase I & II)
13. Ann Dover Community Member & Arts Advocate
7.c
Packet Pg. 73 Attachment: c - Box Art Stakeholder List (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
1
Program Background
In 2010, as part of the City’s Downtown Maintenance and Beautification project, the City Council
approved funding for the Utility Box Art pilot project. This temporary public art pilot project was
initiated by the City of San Luis Obispo with the support of the San Luis Obispo downtown Association
and Arts Obispo. Initially conceived as a graffiti abatement measure to enhance unattractive utility/traffic
control boxes at various high visibility intersections in the Downtown core, widespread popularity of the
box art program quickly grew and enabled the pilot program expand.
The Utility Box Art Program was designed to use the funding for regular lifecycle maintenance of city
assets in a creative way. The program allowed for these street level artworks to add vibrancy to our
cityscape, while creating a sense of place and identity for our community through a resident art selection
jury. These public artworks were not intended to be permanent but as a temporary canvas through which
artists and community members could express themselves and their identity.
Since 2010, various painted utility/traffic control boxes have required maintenance upgrades, installation
of necessary battery back-up cabinets or repairs as a result of unanticipated damages which have had an
impact on the artwork. In 2015, updates to the City’s Public Art policy included the adoption of the
Utility Box Art program a regular, ongoing public art program. Additional program updates were
identified in 2016 to clarify maintenance procedures for the artwork should the utility/traffic control
boxes require repairs, removal or modification, and to address expansion of the program, the life-span of
the artwork and proper archival methods for the box art murals.
The goal of the Utility Box Art Program is to encourage the creative uses of public art throughout the
community through the promotion of new artist opportunities to create works of art that contribute to the
vitality and attractiveness of the streetscape. Artwork on utility boxes function as a form of
communication to a moving audience with the goal of creating a vibrant, inclusive and interesting urban
environment.
PROGRAM
1. Mission of Box Art Program: The primary mission of the “BOX ART” program is intended to
invigorate the City of San Luis Obispo for both residents and tourists alike through the
incorporation of public art on traffic signal utility boxes. The utility boxes serve as community
“canvases” for original pieces of art, contribute to the vitality and attractiveness of the city while
deterring vandalism and graffiti.
2. Glossary of Terms: A Glossary of Terms for the Utility Box Art Program is provided as Exhibit
A.
3. Box Specification: Dimensions of the large utility boxes are generally 5’4” H X 3’3” W x 2’,9”
D. Dimensions of the small utility boxes are generally 3’ H X 2’2” W x 1’6” D. Art should cover
all exposed sides including the top. Utility box sizes may vary; selected artists must be willing to
7.d
Packet Pg. 74 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
2
adjust designs to the box assigned. There are a total of sixty-four (64) City-owned traffic signal
boxes that are included in the Box Art Program. A map of City traffic signal box locations is
provided as Exhibit B.
4. Maintenance of Box Art Murals: The Public Art Program Manager shall prioritize the box art
mural maintenance needs on an annual basis. Utility Box Art murals shall be cleaned annually.
Additional cleanings could be provided through volunteer and partnership opportunities as
available. To help protect the utility box art murals from the environment and extend the life-
span, the utility box art murals located outside of the Downtown Core (and refreshed less
frequently) shall be recoated with an anti-graffiti UV protectant sealant approximately every three
(3) to five (5) years as funding permits. Deaccessioned utility boxes on display as part of an
archival program shall be included in the box art maintenance program, cleaned and re-coated as
needed to protect the integrity of the artwork.
5. Duration of Box Art: Utility Box Art murals shall be on public display for a recommended
period when the utility box would then be eligible for refreshing of the box art mural. The
replacement schedule of the exterior box art murals shall be determined by both the extent of
maintenance and/or repairs required and a box’s location.
a. Significant Repairs: Utility box art murals that are subject to significant repairs (such as
but not limited to: extensive graffiti, vandalism, damaged traffic signal casings, failure of
the internal electrical components, or subject to mechanical maintenance upgrades as
referenced in Exhibit A) shall be reviewed on a case-by-case basis by the Public Art
Manager to determine the extent of repairs or replacement. Any boxes identified for
significant repairs should be designated for a subsequent Box Art painting phase.
a. Location: The duration of display for box artwork shall be subject to the box locations as
follows:
1. Downtown Core (as defined by the SLO Downtown Association boundaries,
Exhibit C): In effort to promote vibrant tourism of the downtown core, the
utility box art located within this area will be refreshed approximately every
three (3) to five (5) years as funding permits. The frequent rotation of artwork
in the downtown promotes economic vitality by attracting new and visiting
populations.
2. All Other City Locations: The utility box art murals located outside of the
Downtown Core boundaries, and in residential neighborhoods, shall be on
display for an extended period of time. The utility box art located in these
areas shall be refreshed approximately every 10 years as funding permits.
6. Utility Box Art Program Expansion: Program expansion shall include utility boxes that are not
currently painted with art. Each expansion phase of utility box art should consist of a
recommended amount of utility boxes; preferring fifteen utility box locations or less. These
utility/traffic control box locations shall be determined by Public Works and Public Art program
staff, with input from community organizations such as the Downtown Association, SLO
7.d
Packet Pg. 75 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
3
Chamber of Commerce, Arts Obispo and neighborhood groups; as meeting one or more of the
following criteria for program expansion.
a. Criteria for Box Art Expansion:
1. Community engagement: The City shall facilitate public engagement
opportunities seeking the community’s input and prioritization for program
expansion.
2. Exposure: The level of pedestrian, bicycle and vehicle traffic surrounding the
potential box location shall be considered. Preference shall be given to box
locations with the greatest exposure.
3. Vandalism: Utility box locations that are routinely subject to vandalism and/or
graffiti shall receive consideration for subsequent program expansion.
4. Proximity to other art in public spaces: Proximity of the traffic signal utility
box location to other community art. Preference shall be given where there is
minimal public art in close proximity.
5. Ownership: Staff will evaluate both City-owned and privately-owned utility
box locations. Preference shall be given to 64 City-owned utility locations.
The City will explore partnership opportunities for program expansion to
privately-owned utility box locations (such as electrical, television and phone
utilities).
7. Artist Eligibility: The Box Art program shall be open to individual artists, a team of artists or
community groups with a designated lead artist who have the vision and skills required
completing the project to the highest standards of innovation and technical expertis e. Qualifying
applicants must reside in San Luis Obispo County. Artists should carefully read the description of
the project and Request for Proposals (RFP) and decide if the project is suitable to their interests,
capabilities and experience.
8. Public Works Department Review: The Public Works Department shall provide input in the
development of the Box Art RFPs before advertising. Prior to beginning the Art Jury review, the
Public Art Manager shall arrange for the proposals to be reviewed by appropriate Public Works
Department staff. The purpose of this review is to identify any significant engineering or
maintenance issues that may arise out of the placement of art or the choice of materials for the
artwork for the particular site. If the artwork is part of a larger construction project, it may be
valuable to have the project contractor present, as well. This information will be presented to the
Art Jury to help guide their decisions when selecting an art design and location.
9. Selecting an Art Jury: Art Jurors evaluate the artist qualifications and box art proposals received
and make a recommendation for selection. The preferred approach in assembling an Art Jury is
to create a five/seven member selection committee for the Box Art project. The Art Jury,
consisting of volunteers from Arts Obispo, SLO Downtown Association, San Luis Obispo
Chamber of Commerce, local artist(s), interested community member(s), City staff and a box art
neighbor(s). A neighbor or representative for each of the affected neighborhoods for the traffic
7.d
Packet Pg. 76 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
4
utility boxes will be selected for an Art Jury. Art Jury names shall be included in the staff
reports.
10. The Jury Evaluation Process: Box Art proposals submitted in response to a Box Art RFP will
be reviewed by the Public Art Manager who will then forward all complete and eligible
applications received by the deadline to the Public Works Department for review. Following this
internal review, proposals shall be provided to the Art Jury for evaluation.
a. Evaluation Criteria: The criteria used to select eligible artists and designs shall be in
accordance with the approved Guidelines for Public Art (Appendix B) and in meeting the
criteria as follows:
1. Evaluation of artistic excellence
2. Appropriateness of scale, form, content and design
3. Relationship to the social, cultural and/or historical identity
4. Experience in working on comparable projects
5. Artists (or lead artist of a team) must reside in San Luis Obispo county
The Art Jury will evaluate all complete, eligible, Box Art proposals received by the deadline. If
the number of qualifying applications does not meet the number needed; City staff and/or the
Council may decide to reopen the selection process. Upon evaluating the qualifications provided
in the Box Art proposals, the Art Jury will recommend to the appropriate Advisory Bodies the
artist designs, totaling the amount of utility/traffic control boxes within a phase, and location.
11. Guidelines and Review Process for Public Art: The adopted Guidelines for Public Art
(Appendix B) will apply in making a determination that the proposed project is acceptable to the
City and should move forward in the selection and approval process. Box art designs and
locations, as recommended by the Art Jury, shall be reviewed by the appropriate Advisory
Bodies. The Cultural Heritage Committee (CHC) shall review for consistency with historical
context of the surrounding area and the Architectural Review Commission (ARC) to ensure the
design meets the adopted Guidelines for Public Art. Designs that do not garner the support of
Advisory Bodies shall not proceed, unless appealed to City Council pursuant to Municipal Code
Section 1.20. Staff shall present the final recommended designs and locations to the City Council
for final approval.
12. Artist Selection and Contract: Following the City Councils’ approval, the Public Art Manager
shall enter into a public art contract agreement with the selected artists for the installation of
utility box art. The Utility Box Art Artist Agreement is provided as Appendix O.
13. Artists’ Stipend: Selected artists shall be compensated for the application of their artwork and
designs. Stipends are based upon the size of the utility box. The stipend amount shall be all-
inclusive and cover costs incurred by the artist in the course of designing and installing the
artwork. In addition, artists may apply for reimbursement of materials, with original receipts. A
7.d
Packet Pg. 77 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
5
maximum value of reimbursement shall apply. The final selected artists will also receive an
honorarium upon the completion of their artwork for their conceptual renderings. The approved
artist stipend amount (as referenced in Exhibit A) shall be reviewed and updated prior to each
Box Art phase.
14. Media and Materials Guidelines: The Media and Material Guidelines is provided as Exhibit D.
These guidelines identify the prerequisite materials such as paints, primers and sealants required
for the exterior box art murals. The approved Media and Materials Guidelines shall be reviewed
and updated prior to each box art phase.
15. Permitting: The selected Artists are required to obtain a no-cost Encroachment Permit through
the City’s Community Development Department prior to the painting of the utility box art mural.
16. Maintenance, Repairs, Modification of Utility/Traffic Control Boxes: The Public Works
Department is responsible for maintaining City facilities, which includes all City-owned or City-
sponsored public art. The City reserves the right to modify or remove artwork should a
utility/traffic control box require maintenance, modifications or repairs as a result of
unanticipated damages. Should this occur, the City shall provide public notification consistent
with the City’s adopted Public Engagement and Notification policies regarding the affected
public art. The City shall notify the affected artist(s) and provide him/her the opportunity to
repair the affected mural. Should the artist be unable to repair the mural, the box art would be
eligible for new public art in the subsequent phase of Box Art. Should the timing of the
subsequent Box Art phase be greater than one year, the utility/traffic control box shall be reverted
back to the standard utility/traffic control box color until it can be incorporated into the next
phase of painting.
17. Archival and Deaccessioning of Box Art Murals: At the end of either the pre-determined
artwork lifespan, or the deaccessioning of the utility boxes as a result of
maintenance/repairs/relocation, the artwork shall be archived in a way to preserve the integrity
and historical context of this public art program.
a. Archival: The preservation of the box art murals shall include both print and electronic
preservation that is accessible to the public. Print materials for the purpose of archival
could include, but are not limited to, brochures, interactive coloring books, postcards,
books, etc. Electronic archival could include, but are not limited to, digital images,
virtual tours or database available via the City’s website.
b. Deaccessioning: In instances where the physical utility box is decommissioned and no
longer in use, the public art program shall identify and recommend options for the
relocation and continued display of the public art mural. Deaccessioning of the utility
boxes could include, but is not limited to, a box art memorial garden or an “adopt-a-box”
program which would provide for ongoing public display of the artwork. The public art
program shall incorporate the maintenance of any deaccessioned boxes on display as part
of the maintenance program, unless otherwise specified.
7.d
Packet Pg. 78 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
6
BOX ART PROGRAM EXHIBITS (included in Public Art Policy as Appendix O)
Exhibit A – Glossary of Terms
Exhibit B – City-Owned Traffic Signal Utility Box & Box Art Map
Exhibit C – Downtown Association Boundary Map
Exhibit D – Media and Materials
Adopted by City Council as amended on XXXXXX, 2016
7.d
Packet Pg. 79 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
7
Exhibit A – Glossary of Terms
Utility Box Art Program Glossary of Terms
Archival: The preservation of the box art murals (both present and past), in both print and electronic form,
in a way that remains accessible to the public.
Art Jury: A selection committee comprised of community volunteers assigned to evaluate art proposals and
make selection recommendations to the appropriate Advisory Bodies. Art Juries consist of volunteers from
Arts Obispo, Downtown Association, Chamber of Commerc e, local artist(s), interested community
member(s), City staff and neighbors to the proposed box art.
ARTS Obispo: The San Luis Obispo County Arts Council (ARTS Obispo) is a local arts non -profit that is
committed to advancing visual, literary and performing arts within the community.
Box Art: A City program for public art where the exterior of utility traffic signal boxes have been painted
with artwork.
Deaccessioned: Relinquishment of artwork from the Box Art Program collection when a utility box is no
longer in use. When possible, deaccessioned boxes will be relocated where the artwork can remain on
public display.
Downtown Association (DA): A local organization supporting the needs of downtown SLO merchants in
the areas of Parking, Promotions, Design, Economic Activities, Food, Beverage & Services and Thursday
Night Promotions.
Downtown Core: In reference to the boundaries assigned by the DA for downtown San Luis Obispo. The
boundaries extend to the West (at Palm Street), South (at Beach Street), East (at Pacific Street), and to the
North (at Santa Rosa Street). Refer to Downtown Association map.
Expansion: The addition of new blank utility boxes to the Box Art Program that are eligible to receive new
artwork. New utility boxes will be added to the program based upon evaluation criteria as determined in
the Box Art Policy.
Evaluation Criteria: A set of conditions identified to help prioritize the next utility boxes eligible for new
artwork. This criteria will utilize community engagement, the level of pedestrian/vehicle/bike traffic of the
area, consideration of any box repairs resulting in vandalism, the box location to other public art and
whether a box is city-owned or privately owned when determining which utility boxes will receive artwork.
Media & Materials: Any paints, primers, wraps, protective coating and sealants used in the application of
exterior box art murals.
Mural: A piece of artwork painted, or applied directly, on the exterior of a utility box.
Painting (new): Refers to the application of a new box art mural on a blank utility box that is currently void
of public art.
7.d
Packet Pg. 80 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
8
Phase: A collection or group of utility boxes that are painted with artwork during a given time period.
Private Utility Boxes: Any utility box that is not owned or operated by the City of San Luis Obispo and that
provides community utilities primarily for power (PG&E), telephone (AT&T), television (Charter) or other.
Refresh (rotating art): When existing box art murals have either reached the pre-determined life span or
require “significant” repairs, the utility box is eligible for a new art mural. Existing box art murals are then
“refreshed” with new art.
Repair: Refers to routine box art mural repairs to correct chipping or minor damage to the artwork.
Significant Repairs: Refers to the extent and cost of repairs to the utility box case and the affected artwork.
“Significant” is determined when the cost of repair exceeds 50% of the value of the artwork stipe nd.
“Significant” is also determined when the extent of the damage to the artwork surface area is greater than
25% (one side panel). Any boxes identified as needing “significant repairs” will be designated for a
subsequent Box Art painting phase.
SLO Chamber of Commerce: The San Luis Obispo Chamber of Commerce is an independent non-profit
corporation that works to enhance economic prosperity of its membership and the community well -being of
San Luis Obispo County.
Stipend: Compensation provided to selected box artist for the application of their artwork and mural
designs. Stipends are based upon the size of the utility box. The stipend for a large utility box is $1,500,
and small utility box $700 which shall be all-inclusive of material costs. A materials reimbursement is
provided to selected artists in an amount not –to-exceed $200 (original receipts required). Following the
completion of the box art murals, the artist will receive an honorarium of $100 for their mural design .
7.d
Packet Pg. 81 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
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Exhibit B – City Traffic Signal Locations
7.d
Packet Pg. 82 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
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Exhibit C – Downtown Association Boundary Map
7.d
Packet Pg. 83 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT D – Proposed Amendment to Public Art Policy for Utility Box Art Program
Public Art Policy (Excerpt Pages 19-21)
Proposed Policy Updates = Highlighted (Yellow Highlights represent new Box Art policy
language as proposed by the Box Art Stakeholders Group and as recommended by the
Parks and Recreation Commission)
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EXHIBIT D - Box Art Media and Materials Guidelines
The following is a guideline for paint, primer and sealant materials to be used by the City and selected artists for the
Box Art program murals. The Media and Materials Guidelines shall be reviewed and updated prior to each box art
phase.
Media
The submitted Artwork must be original and may not contain advertising, religious art, sexual or illegal drug -related
content, negative imagery or convey political partisanship.
Vinyl wraps of “digitally enhanced works” are permitted.
Materials
Paints, primers and sealant materials to be used for Box Art program murals:
City Responsibility
To prepare the utility boxes to accept the mural artwork, the City will coordinate the cleaning and priming of the
utility boxes prior to the first day of painting
Following completion of the artwork murals, the City will seal the utility boxes with a UV -protective and anti-
graffiti clear-coat. This topcoat is applied directly on murals as protectant.
Frog Juice Water Based: Clear urethane copolymer coating which contains absorbers and hinders amine
light stabilizers for maximum UV light protection.
Artist Responsibility
Selected artists for the Box Art Program must use the following materials as outlined below:
Paint Types
Paint Types require premium high solids 100% acrylic latex waterborne exterior wall and trim.
Paint; low-sheen, eggshell or satin finish; minimum 1.5 mil dry thickness per coat.
Paint Products (in recommended order):
1. Nova Color (preferred)
2. Sherwin Williams: Accolade Exterior Acrylic Latex, Satin
3. Pratt and Lambert: Accolade Exterior Acrylic Latex, Eggshell
4. Benjamin Moore: Aura Exterior Acrylic Latex #634 Low Luster
5. Frazee #126 Mirror Glide Low Sheen Acrylic Latex
6. Kelly Moore #1245 Acry-Shield Acrylic Latex Low Sheen.
Top Coat:
Polyurethane top coat (marine grade) to be applied on top of the completed artwork to serve a
sacrificial layer
Vella 5% Fluoride Varnish
Materials List updated April 2016
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Packet Pg. 84 Attachment: d - Amend to BoxArtPolicy2016 (1411 : Box Art Policy Amendments)
ATTACHMENT F - Modified Utility Boxes with UPC Battery Backup Units
Box #12 – Marcia
Box #24 – Chris Pederson
Box #12 – Marcie Hawthorne
Box #25 – Chris Pederson
Box #6 – Allister Dipner
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Packet Pg. 85 Attachment: e - Modified Box Locations (1411 : Box Art Policy Amendments)
ATTACHMENT F – Downtown Association Boundary Map
7.f
Packet Pg. 86 Attachment: f - DA Boundary Map (1411 : Box Art Policy Amendments)
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blank.
Meeting Date: 7/19/2016
FROM: Katie Lichtig, City Manager
Prepared By: Lee Johnson, Economic Development Manager
Greg Hermann, Principal Analyst
SUBJECT: GUIDING PRINCIPLES FOR THE DIABLO CANYON POWER PLANT
CLOSURE AND RELATED ISSUES
RECOMMENDATION
Adopt guiding principles to provide direction to staff on the Diablo Canyon Power Plant closure
and related impacts as this issue moves through the various regulatory processes.
DISCUSSION
Background
On June 21, 2016 Pacific Gas & Electric (PG&E) announced that it will close the Diablo Canyon
Power Plant (DCPP) when the current operating licenses from the Nuclear Regulatory
Commission (NRC) expire in 2024 and 2025. The announcement also stated that a Joint Proposal
(JP) for the closure had been reached with labor and environmental groups, but required final
approval by the California Public Utilities Commission (CPUC) and was contingent on the
extension of current leases with the State Lands Commission (SLC), for the ocean intake and
outfall structures. The JP and additional information provided by PG&E at the time of the
announcement are included as Attachments a and b.
On June 23, the City Council held a special meeting and approved a letter to the SLC in support of the
extension of the leases (Attachment c). At the SLC meeting on June 28, the Commission unanimously
approved the extension of the leases. On July 13, PG&E held a meeting at their headquarters in San
Francisco regarding the “Joint Proposal Governing the Closure of Diablo Canyon Power Plant at
Expiration of Current Licenses and Orderly Replacement with a Portfolio of GHG-Free Resources”.
City staff was able to join this meeting via a listen only conference call. PG&E advised at the closing
of the meeting that the presentation and a summary of the questions and comments from the meeting
would be made available. As of the writing of this report those materials have not yet been made
available. Also on July 13, the County Board of Supervisors held a closed session meeting and voted
unanimously to apply to become an intervener in all of PG&E’s filings with the CPUC. The
intervener status would allow the County a “seat at the table” for the discussions and negotiations as
the JP moves through the CPUC process. On July 14, the San Luis Coastal Unified School District’s
Board of Trustees also voted unanimously during a special closed meeting to formally intervene in all
of Diablo Canyon’s proceedings before the California Public Utilities Commission, including the
plant’s closure and the proposed three-year general rate case starting in 2017.
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The next steps include public meetings to receive feedback on the JP in San Luis Obispo on July
20 and in South San Francisco on July 22. Attachment d is a press release from PG&E regarding
the public meetings. The input received at the public meetings will be summarized and included
with the PG&E’s filing of the JP to the CPUC. PG&E has advised that the expected filing date is
July 28, 2016. The CPUC will then begin a review process that is anticipated to be completed by
the end of 2017.
Status of City Efforts
Since the announcement of the closure, staff has been in active discussions with various
interested parties in the community including the County, the San Luis Coastal Unified School
District, the San Luis Obispo Chamber of Commerce, the Economic Vitality Corporation (EVC),
the Alliance for Nuclear Responsibility and many business and community leaders. The City has
also reached out to PG&E to coordinate a direct meeting to learn as much as possible about
PG&E’s perspective on the steps in this complex process and determine the potential for City
input in the ongoing CPUC process. That meeting is tentatively scheduled for July 21. Due to the
complicated nature of the CPUC process, the City is in the process of determining the need to
retain outside counsel that is qualified to advise the City on the CPUC process. Staff is also
working to determine the City’s role and potential level of influence with other regulatory
agencies as it relates to the closure of DCPP and the JP. It should be highlighted that the
information available is still relatively limited and that staff is relying on statements and
materials from various public meetings, one on one meetings, second hand information from
other governmental agencies and group meetings with PG&E (in additional to what is provided
in this report).
Staff has also been working to identify the direct and indirect impacts of the closure on residents,
the community and the City. The majority of financial impacts to the City itself are indirect in
nature, based on the loss of jobs, loss of sales tax and loss of TOT revenue. There are, however,
some potential direct impacts to public safety funding and other revenues that are still being
determined.
Moving Forward
There are currently several PG&E related items before the CPUC including their normal general
rate case. The JP will become a new filing and covers three main areas including nuclear power
replacement, employee retention and the impact to the community. Based on the information
available to date, the opportunity for the City to have the greatest influence on the process is
related to the JP filing. There may also be opportunities for input during the filing process for the
actual decommissioning plan for DCPP, but that is still being determined. Staff is also discussing
possible cooperative efforts with other governmental agencies in the region. Given the short
timelines and the potential need to react quickly to provide input and/or participate in the CPUC
process related to the JP, staff recommends the development of “guiding principles”. The
guiding principles, if approved by the Council, will ensure input provided by staff is reflective of
the policy direction of the Council. Draft principles have been created for Council review and
consideration.
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Based on some of the information that has been made available, the City may also have a
relatively short window to apply for intervener status (similar to the County and the School
District) or another level of involvement regarding PG&E’s filing of the JP with the CPUC. Staff
is seeking Council concurrence to file directly with the CPUC as intervener or other level on
behalf of the City should that opportunity be available based on information gathered after the
July 19, 2016 City Council meeting. This may need to be done as early as July 28, 2016.
It is also worth noting that staff is exploring the need for additional subject matter experts such
as legal advisors on the CPUC process and technical or public affairs advisors. Staff will keep
the Council and community updated as these needs are defined and return for authorization as
required.
Guiding Principals
The guiding principles will help staff in the process of providing input at the public meetings
regarding the closure, in general stakeholder discussions and in any potential CPUC filings as it
relates to PG&E’s commitment to the community. Currently, the commitment to the community
in the JA includes $49.5 million to provide a consistent stream of funding to replace the loss of
property tax revenue due to the depreciation of the DCPP between now and 2025. It also
provides ongoing support for emergency services programs. The JP does not provide specific
funding or commitments for any other direct or indirect impacts to the City. Based on PG&E’s
responses to questions at the SLC meeting regarding the impacts to affected communities and
other issues raised at the July 13 meeting, PG&E has advised that the JP acts as a floor or
minimum and that interested parties can work to secure additional resources to effectively
manage the transition to a post DCPP environment.
In order to provide a framework for the City’s position on this issue staff has developed the
following draft guiding principles for Council consideration. These guiding principles cover both
items that have already been addressed in the JP and items that have not yet been addressed.
Each guiding principle has a list of examples of the type of initiatives, programs or mitigations
that the Council could support. These lists of examples are illustrative only and by no means
exhaustive nor should they be considered representative of specific requests of the City.
Draft Guiding Principals
The City is requesting a “seat at the table” for the relevant parties in the community, including
but not limited to The San Luis Coastal School District, the County of San Luis Obispo, the cities
and other governmental agencies in the region in order to:
1) Ensure the continued safe operation of the DCCP and the health and safety of the
community. The primary focus is the emergency preparedness funding extension, but
may also include other public safety related activities.
2) Be involved in creating solutions that will lessen the short and long term financial
impacts to the community. This could include a longer runway on tax offsets to ease the
transition, direct funding for programs impacted by the loss of tax revenue and other
direct financial contributions. A tangential issue that may be addressed is the fair and
equitable cost sharing between ratepayers and PG&E corporate assets and shareholders.
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3) Investigate opportunities for job creation and economic diversification. Examples of
this could include creation of a research and development facility located in the region,
alternative energy generation technologies (small scale), job training programs and seed
funding for relevant economic programs and opportunities. These opportunities could
involve direct funding and/or commitments for a certain amount of jobs remaining in the
community for a specified amount of time.
4) Develop a plan to address the potential long term impacts of closing a nuclear facility.
This includes spent fuel management, decommissioning and local vendor preference for
request for offers (RFO) for new energy sources.
5) Explore the future use of the land and related facilities. This could include
desalinization, large scale energy generation and general land designation (open space,
development, etc.)
While these principles do not cover every possible opportunity or issue, they are envisioned to
provide the broad outline that will be guidance for staff input and action. Major policy questions
or issues outside of these principles will be brought to the Council during this process as needed.
FISCAL IMPACT
While there is no direct financial impact from the approval of the guiding principles, there is a
potential fiscal impact from not being able to provide input on the closure process. There is also
a potential cost to securing outside counsel, technical or public affairs experts to assist with the
City with JP filing process at the CPUC or representing the best interests of the City. Those costs
are initially anticipated to be covered by the Administration Department. Should the needs for
subject matter experts exceed available budget or procurement limits staff will return to the
Council with a specific recommendation.
ALTERNATIVES
1. Modify the guiding principles.
The City Council may wish to modify the guiding principles based on deliberation. Specific
direction should be given regarding changes.
2. Provide direction to apply as an intervener or similar level with the CPUC.
The City Council may wish to provide direction to apply as an intervener or other level with
the CPUC on behalf of the City should that opportunity be made available.
3. Take no action.
The City Council may wish to not take any action. This is not recommended due the potential
significant impacts for the City and region associated with the closure of the Diablo Canyon
Power Plant and the current opportunity to influence the process.
ATTACHMENTS
a. Joint Proposal
b. PG&E presentation on the Joint Proposal and presentation on the background for the
Joint Proposal
c. City letter to the State Lands Commission in support of the extension of the leases
d. PG&E public meeting press release
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Joint Proposal for the Orderly Replacement
of Diablo Canyon Power Plant
with Energy Efficiency and Renewables
JUNE 21, 2016
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Joint Proposal for the Orderly Replacement of Diablo Canyon
M.J. Bradley & Associates, LLC Page | 2
Executive Summary
Pacific Gas & Electric (PG&E), International Brotherhood of Electrical Workers Local 1245, Coalition of
California Utility Employees, Friends of the Earth, Natural Resources Defense Council, Environment California,
and Alliance for Nuclear Responsibility (together, the parties) have developed a joint proposal to retire PG&E’s
Diablo Canyon Power Plant at the close of its current operating license period and replace it with a portfolio of
greenhouse gas (GHG)-free resources. The joint proposal:
ensures the cost-effective and orderly replacement of Diablo Canyon with GHG-free resources;
provides a responsible and supportive transition for Diablo Canyon employees and the
community;
facilitates renewables integration through a reliable and more flexible resource mix; and
greatly diminishes Diablo Canyon impacts on fishery resources at the end of the current license
period, avoiding the need to install cooling towers under California’s once-through-cooling
policy.
Under the joint proposal, PG&E will continue to operate Diablo Canyon at current levels through the current
license period. In 2024, PG&E will retire Unit 1, and in 2025 will retire Unit 2. To ensure the orderly
replacement of Diablo Canyon with GHG-free resources, the settlement lays out specific procurement
requirements starting in 2018 and continuing through 2031. PG&E will procure 2,000 GWh of new energy
efficiency projects and programs to be installed from 2018 to 2024. As a second step, PG&E will procure another
2,000 GWh of energy efficiency or GHG-free energy to be initiated between 2025 through 2030. Finally, PG&E
commits to procure the necessary levels of renewables to meet a 55 percent Renewables Portfolio Standard by
2031. In addition to these procurement targets, parties agree to support (before the California Public Utilities
Commission and the California Independent System Operator) the use of GHG-free resources, including but not
limited to pumped hydroelectric storage, for additional reliability and resource integration solutions which may be
required to replace Diablo Canyon.
Diablo Canyon has reliably served the electricity needs of PG&E’s customers since 1985. However, California’s
electric grid is in the midst of a significant shift that creates challenges for the facility in the coming decades.
Changes in state policies, the electric generation fleet, and market conditions combine to reduce the need for
large, inflexible baseload power plants. These forces reduce the need for Diablo Canyon’s output beyond the
current license period. PG&E is faced with four primary planning challenges associated with operating Diablo
Canyon beyond the current license period:
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Joint Proposal for the Orderly Replacement of Diablo Canyon
M.J. Bradley & Associates, LLC Page | 3
1. Uncertain PG&E Electricity Supply Needs: Three key trends have significantly reduced PG&E’s
electricity sales in recent years and will likely have even greater impacts in the future.1 This downward
pressure on sales is reducing the need for electricity from Diablo Canyon. First, ongoing and aggressive
energy efficiency policies are projected to reduce overall electricity consumption. Second, customers are
likely to increase the amount of electricity generated through distributed generation (DG), especially
privately-owned solar resources. Finally, PG&E’s bundled customer base is likely to decrease as some
households and businesses choose to buy their generation from alternative providers, either through
Direct Access or Community Choice Aggregation. The precise impact each of these factors will have on
PG&E’s electricity supply needs is not certain, though they combine to support a clear downward trend
on PG&E electricity sales.
2. Decreasing Need for Baseload Generation: As the electric grid in California continues to evolve, so too
will the character of resources needed to operate the California electric system reliably. Given
California’s energy goals that require increasing reliance on renewables – at least 50 percent by 2030 –
the California electric system will need more flexible resources while the need for baseload electricity
supply will decrease. PG&E will need less non-renewable baseload generation to supply its electricity
customers. Hence the need for baseload power from the large Diablo Canyon Power Plant will decrease
in the post 2025 timeframe.
3. Challenges with Renewable Overgeneration: Another aspect of this changing California electric system is
the prospect of mounting “overgeneration” conditions. As more solar generation comes on line over time
and when its output is at peak supply (e.g., in the middle of the day), there is less room on the electric
system for energy from inflexible and large baseload resources such as the Diablo Canyon Power Plant.
Overgeneration conditions can force the system operator to take action to curtail generation (e.g., dispatch
generators down, or even disconnect supply from the grid) in order to maintain electric system reliability.
Retirement of Diablo Canyon on the timeframe agreed to in the joint proposal will allow for increased
flexibility for the California electric system so as to help maximize the value of solar and other variable
resources that will be a crucial part of meeting PG&E’s renewable targets and California’s renewable and
GHG emissions goals.
4. Ongoing Costs for Diablo Canyon: Diablo Canyon has served as a valuable resource providing reliable
electricity for decades. However, future operating costs are uncertain due to a variety of potential
regulatory and other factors and could increase as the facility ages. California’s environmental protection
regulations and other state and federal requirements may increase future costs beyond 2025. These
include, for example, any environmental mitigation or compliance measures required by California
resource agencies, retrofits to comply with the State Water Control Board’s Cooling Water Intake
Structures regulation, or additional regulations or orders from the Nuclear Regulatory Commission in
response to federal regulatory or legislative changes either currently under consideration or in the future.
Additionally, due to expected overgeneration throughout parts of the year, Diablo Canyon may contribute
to higher system costs as its current generation profile causes challenges for efficiently integrating
1 Throughout this report, “PG&E electricity sales” refers to PG&E’s bundled retail sales (i.e., “bundled” electricity,
transmission and distribution services).
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renewable resources. Therefore, if Diablo Canyon were not relicensed, the cost to integrate renewables
could be lower.
The joint proposal would benefit PG&E customers and the state of California by reducing emissions, supporting a
reliable and cost-effective electric system, and supporting PG&E employees and the community PG&E serves.
Lowering GHG emissions: PG&E’s portfolio has long been one of the lowest emitting in the country.
Half or more of its procured electricity is consistently GHG-free, and renewable procurement has more
than doubled in the last seven years. Under the joint proposal, PG&E commits to reaching 55 percent
renewable deliveries, representing nearly a doubling of today’s renewable procurement and a 10 percent
increase over state regulatory requirements for 2030. Combined with existing policies and the joint
proposal’s energy efficiency measures, this will contribute to a significant decrease in GHG emissions.
Maintaining reliability: The parties are confident that Diablo Canyon can be retired while continuing to
maintain a cost-effective PG&E electric system. Numerous studies have shown that Diablo Canyon could
be removed from the California electric system without harming reliability; indeed, PG&E’s transmission
system has been maintained and designed in order to withstand the loss of both Diablo Canyon units.
Furthermore, the joint proposal provides for a deliberate and orderly phase out of Diablo Canyon,
allowing time to replace the facility with GHG-free resources and to ensure the transition occurs while
maintaining reliability.
Maintaining cost-effective electricity service: GHG-free replacement resources will be procured through
California Public Utility Commission-approved competitive bidding processes, which will ensure that the
lowest-cost clean resources are used to replace Diablo Canyon, and that the relevant stakeholders are
involved in monitoring and assisting the procurement process. A number of studies have demonstrated
that Diablo Canyon generation could be cost-effectively replaced by GHG-free resources.
Continuing commitment to PG&E employees and community: Key provisions of the agreement reflect the
fact that PG&E depends upon and has been committed to its employees and the communities in which the
utility operates and serves customers. Under the joint proposal, it will be critical to retain existing
employees, who are highly qualified and will drive continued safe and reliable operations. PG&E will
provide a generous retention program and severance payments upon completion of employment. PG&E
will help employees transition to new positions through a retraining and development program to
facilitate redeployment of a portion of plant personnel to the decommissioning project. Additionally, the
Diablo Canyon Power Plant is one of the largest employers, taxpayers, and charitable contributors in the
San Luis Obispo County area. In order to further support this local community, PG&E proposes to
continue providing funding to San Luis Obispo at current property tax levels through 2025.
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Introduction
Pacific Gas & Electric (PG&E), International Brotherhood of Electrical Workers Local 1245, Coalition of
California Utility Employees, Friends of the Earth, Natural Resources Defense Council, Environment California,
and Alliance for Nuclear Responsibility (together, the parties) have developed a joint proposal to phase out
PG&E’s Diablo Canyon Power Plant by 2025 and replace it with a portfolio of greenhouse gas (GHG)-free
resources. The joint proposal:
ensures the cost-effective and orderly replacement of Diablo Canyon with GHG-free resources;
provides a responsible and supportive transition for Diablo Canyon employees and the
community;
facilitates renewables integration through a reliable and more flexible resource mix; and
greatly diminishes Diablo Canyon impacts on fishery resources at the end of the current license
period, avoiding the need to install cooling towers under California’s once-through-cooling
policy.
The joint proposal is rooted in California’s unique energy and policy landscape. California is in the midst of a
significant shift in the character of its electric system, and is on its way toward achieving aggressive and critical
environmental targets. The parties’ joint proposal recognizes these goals. It builds upon them and offers
additional commitments for energy efficiency and renewables that go beyond existing requirements to help
further California environmental objectives and invest in the state’s energy future. Further, the joint proposal
recognizes the realities of a changing electricity landscape in the state, one that includes increasing levels of self-
generation, community choice aggregation, and renewable energy resources, all of which decrease PG&E’s need
for other sources of generation.
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Under the joint proposal, the parties agree to a deliberate and orderly transition away from Diablo Canyon.
PG&E would retire both units at Diablo Canyon at the end of their current license period and replace it with a
portfolio of GHG-free resources to continue to provide clean, reliable, and cost-effective service to customers. In
the next two years, PG&E will prepare a site-specific decommissioning plan for Diablo Canyon following the
joint proposal schedule. Key aspects of the joint proposal map directly to California’s energy and climate goals:
PG&E commits to achieve 55 percent renewable generation by 2031, representing an increase
over current state targets that require 50 percent by 2030;
PG&E will procure at least 2,000 gigawatt-hours (GWh) of additional energy efficiency projects
and programs, which will increase energy savings, building on California’s nation-leading
targets;
PG&E will facilitate more renewables integration and California’s GHG reduction goals through
the specific energy efficiency and renewables targets in the joint proposal and by procuring
additional GHG-free resources that may be needed.
On behalf of the parties to the joint proposal, M.J. Bradley & Associates (MJB&A) was retained to assess and
explain the main components of the proposed agreement and the key considerations and analyses that support the
plan. This document begins with an overview of how California’s changing electric grid poses significant
challenges for large, inflexible baseload resources. These market forces are reducing the long-term need for
Diablo Canyon’s output. The second section summarizes the key provisions included in the joint proposal,
including the specific procurement targets for energy efficiency and GHG-free energy and PG&E’s commitment
to achieving a 55 percent Renewables Portfolio Standard (RPS). The final section of the document highlights the
outcomes that would be expected if the joint proposal were implemented. This discussion addresses impacts on
emissions, grid reliability, customer affordability, employees, and the local community.
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Challenges for Long-term Operation of Diablo
Canyon
Diablo Canyon has reliably served the electricity needs of PG&E’s customers since 1985. However, California’s
electric grid is in the midst of a significant shift that creates challenges for the facility in the coming decades.
Changes in state policies, the electric generation fleet, and market conditions combine to reduce the need for
large, inflexible baseload power plants. These forces reduce the need for Diablo Canyon’s output beyond the
current license period.
1. Uncertain PG&E Electricity Supply Needs
A crucial component of maintaining a safe, reliable, and cost-effective electric system is ensuring that electric
supply is balanced with customer demand. Customer demand projection is an inexact science, as many factors
out of the control of grid planners (for example, weather or economic activity) can have a large impact on how
much electricity will be needed. Despite this inherent uncertainty, three key trends have significantly reduced
PG&E’s electricity sales in recent years and will likely have even greater impacts in the future. This downward
pressure on sales is reducing the need for electricity from Diablo Canyon. First, ongoing and aggressive energy
efficiency policies are projected to reduce overall electricity consumption. Second, customers are likely to
increase the amount of electricity generated through distributed generation (DG), especially privately-owned solar
resources. Finally, PG&E’s bundled customer base is likely to decrease as households and businesses instead
choose to buy their generation from alternative providers, either through Direct Access (DA) or Community
1. Uncertain Electricity Supply Needs for PG&E
Resource Planning Challenges Beyond Current License Period
4. Uncertain Rising Costs for Diablo Canyon
2.Declining Need for Diablo Canyon Generation
3. Challenges with Inflexible Baseload Generation
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Choice Aggregation (CCA). The precise impact each of these factors will have on PG&E’s electricity supply
needs is not certain, though they combine to support a clear downward trend on PG&E electricity sales.
Energy Efficiency
Beginning more than 40 years ago, California has established some of the most aggressive energy efficiency
policies in the country. The state began its energy efficiency journey by instituting efficiency standards for
appliances in 1977, the first state to do so, followed closely by standards for new buildings in 1978. With the
“decoupling” of utility revenues from total electricity sales that began in 1982, California removed barriers and
disincentives for investment in energy efficiency by utilities and other parties across the state. As shown in
Figure 1, California has put in place dozens of rebate programs, incentives, and standards that have kept
California per capita electricity use flat while the rest of the country increased by 50 percent since the 1970s.2
Since 2003, energy efficiency programs and standards have saved enough electricity to power more than half of
California's homes for one year and enough natural gas to serve two million homes annually.3
Figure 1. California electricity consumption, per capita (kWh)
The California Energy Commission (CEC) tracks the progress of the collective impact of energy efficiency
programs. In a 2015 analysis, it noted that statewide electricity consumption in 2014 grew by less than 1 percent
while employment and gross state product grew more than twice as much (2.3 percent). In fact, between 2000
and 2014, California's gross state product grew by 27 percent, which was more than triple the growth in electricity
demand.4 By 2013, efficiency and conservation programs had led to the annual avoidance of nearly 70 terawatt
2 Natural Resources Defense Council, “California’s Golden Energy Efficiency Opportunity: Ramping Up Success to Save
Billions and Meet Climate Goals,” August 2015, available at https://www.nrdc.org/sites/default/files/ca-energy-
efficiency-opportunity-report.pdf
3 Ibid.
4 California Energy Commission, “Tracking Progress – Statewide Energy Demand.” Available at
http://www.energy.ca.gov/renewables/tracking_progress/documents/statewide_energy_demand.pdf
Source: NRDC (August 2015)
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hours (TWh) of electricity consumption, which is roughly equivalent to one-third of the state’s total electric
generation.5,6
Efficiency savings will only increase in the future. In 2008, California created the Long Term Energy Efficiency
Strategic Plan that included the following key goals:
All new residential construction in California will be zero net energy by 2020.
All new commercial construction in California will be zero net energy by 2030.
Heating, ventilation, and air conditioning (HVAC) will be reshaped to ensure optimal
performance for California’s climate resulting in a 50 percent improvement in efficiency in the
HVAC sector by 2020.
All eligible income-qualified customers will have the opportunity to participate in special energy
programs by 2020.
Existing homes will use 20 percent less energy by 2015 and 40 percent less by 2020.7
Recent legislation has codified and further accelerated these goals. Senate Bill 350 requires the CEC to establish
annual targets to double statewide energy efficiency savings in electricity and natural gas end uses by January 1,
2030. Assembly Bill 802 requires the California Public Utilities Commission (CPUC) to consider incentives for
energy efficiency measures that allow for a broader array of incentive programs with higher potential efficiency
savings. In all, the CEC projects that building energy use will be 20 percent below 2014 levels by 2030, even
accounting for economic growth and an increase in vehicle electrification.8
Customer Distributed and On-site Generation
PG&E customers are increasingly choosing to generate their own electricity, often through privately-owned solar
panels, rather than purchase it from PG&E. PG&E must still maintain the transmission and distribution
infrastructure required to incorporate this customer-side generation onto the grid and ensure that all customers
have access to a reliable electricity source, even when privately-owned generators are not running. However,
privately-owned generation decreases overall procurement needs for PG&E, as electricity is now being produced
by small customer-side installations throughout its service area.
The rise in privately-owned, customer-side generation has been driven by state policy in combination with the
falling cost of distributed generation technologies. One of the first programs of its kind, the California Self -
Generation Incentive Program was conceived in 2001. The program provides incentives for the installation of
5 California Energy Commission, “Tracking Progress – Energy Efficiency” (CEC Tracking Progress - EE). Available at
http://www.energy.ca.gov/renewables/tracking_progress/documents/energy_efficiency.pdf
6 One terawatt hour equals 1,000 gigawatt hours.
7 Energy Upgrade California, “Our Energy Efficiency Strategies,” available at
https://energyupgradeca.org/en/learn/energy-in-california/our-energy-efficiency-strategies
8 CEC Tracking Progress - EE.
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small, customer-side wind and cogeneration generators as well as emerging technologies such as energy storage
and fuel cells. A total of 252 MW have been brought online under the program.9
The largest source of small, privately-owned generation in California is solar installations on the customer-side of
the meter at residences and businesses. The California Solar Initiative is a rebate program launched in January of
2007 and provides incentives for privately-owned solar systems installed on existing homes and on commercial,
industrial, government, non-profit, and agricultural properties within the service territories of the state’s three
investor-owned utilities. As of May 2016, there were 1,750 MW installed under the program and another 187
MW of pending projects.10
Many of these privately-owned, customer-side solar installations are eligible for California’s net energy metering
program. Under this program, a meter tracks how much electricity is consumed by the customer and how much is
sent from the customer’s system back to the grid. Over the course of the year, the customer only pays for the net
amount of electricity used from the utility. The number of privately-owned solar installations significantly
increased in 2010, as solar leasing companies lessened the up-front cost of investment through new financing
mechanisms and favorable state and federal policies.
PG&E has connected more privately-owned solar systems to its grid than any other utility in the country. On-site,
privately-owned, grid-connected generation levels increased across PG&E’s service territory by more than 170
percent between 2010 and 2015, rising from less than 2 TWh to nearly 5 TWh. Continuing this high growth rate,
on-site generation levels are projected to increase another 400 percent above 2015 levels by 2030 (over 23 TWh
of total annual output). At this level in 2030, on-site generation would represent over one-fifth of total electricity
usage in PG&E’s service territory.
Retail Electricity Choice
Starting in the late 1990s, California policies required electric utilities to “unbundle” their electric service into
separate generation and delivery components. While
PG&E was still required to maintain the electric grid
to ensure delivery to all customers in its service area,
customers could shop around to have suppliers other
that PG&E provide the generation that was
delivered. Known as “direct access,” this program
allowed for a shift away from PG&E-procured
energy. However, after the energy crisis in 2000 and
2001, the Commission suspended the direct access
program, effectively placing a cap on total
generation that could be provided by direct access
providers (also called “electric service providers”)
and restricting new customers from switching to
9 California Public Utilities Commission, “About the Self Generation Program.” Available at:
http://www.cpuc.ca.gov/General.aspx?id=11430
10 Go Solar California, California Solar Statistics, “Monthly, Quarterly, and Annual Statistics,” accessed May 2016.
Available at https://www.californiasolarstatistics.ca.gov/reports/monthly_stats/
Figure 2. DA/CCA-served generation in PG&E service
territory (TWh)
0
5
10
15
20
25
30
35
40
2010 '12 '14 '16 '18 '20 '22 '24 '26 '28 '30
High
Low
Source: MJB&A analysis based on data provided by PG&E
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direct access. The program was re-opened on a limited basis to commercial and industrial customers in 2010.
There are currently around 20 active electric service providers in California.11
In 2003, the California legislature passed a law that created an exemption to the direct access suspension, by
allowing cities and counties to form “community choice aggregators,” or CCAs, that would, similar to an energy
service provider, provide generation for a distinct set of customers through PG&E’s transmission and distribution
system. At the start of this year, there were two CCAs operating in PG&E’s service area (Marin Clean Energy
and Sonoma Clean Power), serving approximately 370,000 customers; a third (CleanPowerSF) has just recently
launched.12
California-wide, alternative service providers delivered just over 10 percent of the electricity to California
customers in 2014.13 Though direct access participation in PG&E’s service area is capped, CCAs are continuing
to form within the service area. In addition to the existing CCAs, two additional CCAs in PG&E’s service area
are expected to become operational in 2016 (Silicon Valley Community Choice Energy Partnership and Peninsula
Clean Energy), while another three are in various stages of implementation.14
As more customers choose to receive their electricity from CCAs, PG&E’s procurement needs for its remaining
customers will decrease. Some estimate that up to 60 percent of California residents currently live within the
bounds of a community that is pursuing or exploring a CCA program.15 Though there is uncertainty as to the total
generation that may eventually be served by direct access and CCA providers, these programs could cut PG&E
electricity sales by 33 TWh by 2030 (See Figure 2).
Implications for PG&E’s Electricity Supply Needs
Combined, these three factors point to likely decreases in PG&E’s “bundled” retail sales (i.e., electricity sales that
are “bundled” with transmission and distribution services), though the exact amount is uncertain. As shown in
Figure 3, energy efficiency and departing load due to DG and DA/CCA programs are projected to reduce bundled
sales by 5 to 30 percent below current levels (between 3 and 21 TWh). This reduction is equivalent to about 20
percent, if not up to 125 percent, of total generation from Diablo Canyon.
11 California Energy Almanac, “Electric Load Serving Entities (LSEs) in California, Last Updated February 2015.
Available at http://energyalmanac.ca.gov/electricity/utilities.html#200.
12 Romanow, K. Memo to Transportation and Environment Committee, Attachment A, City of San Jose, CA. January 15,
2016 (Romanow 2016). Available at: http://sanjose.granicus.com/MetaViewer.php?meta_id=554363.
13 Energy Information Administration, “Sales to Ultimate Customers (MWh) by State by Sector by Provider, 1990 -2014.”
Available at https://www.eia.gov/electricity/data/state/sales_annual.xls
14 Romanow 2016.
15 E&E News, “Meet the latest disruption for utilities: community power,” June 9, 2016. Available at
http://www.eenews.net/energywire/2016/06/09/stories/1060038517.
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Figure 3. PG&E electricity supply obligations after accounting for EE, distributed generation, and DA/CCA
Though projections of electricity needs are always complicated, these trends point to a declining need for Diablo
Canyon generation.
2. Decreasing Need for Baseload Generation
As the electric grid in California continues to evolve, so too will the character of resources needed to operate the
system reliably. In conjunction with the resources anticipated by Senate Bill 350, which requires PG&E, and
other utilities in the state, to supply at least 50 percent of their electricity from qualifying renewable resources by
2030 – the most aggressive renewable standard in the country16 – there will also need to be other electric
resources to synch up with those renewables to assure that the lights stay on even when the wind dies down or
when the sun is not shining.
An electric grid with significant generation from non-dispatchable, variable energy resources (wind and solar)
will also require a mix of flexible generating facilities and/or storage systems to pair up with them. According to
California Independent System Operator (California ISO or CAISO), “[t]o ensure reliability under changing grid
conditions, the ISO needs resources with ramping flexibility and the ability to start and stop multiple times per
day. To ensure supply and demand match at all times, controllable resources will need the flexibility to change
output levels and start and stop as dictated by real-time grid conditions.”17
Recent studies, such as those by the National Renewable Energy Laboratory (NREL), have evaluated the
implications of higher solar penetration for grid reliability in California and have emphasized the need for more
nimble and complementary resources (e.g., quick-start power plants, demand-control devices, battery storage) that
provide the grid operator with a greater degree of control and balance the electric system at all times.18 In the
16 SB-350 Clean Energy and Pollution Reduction Act of 2015 (Approved by Governor October 7, 2015)
17 CAISO, “Fast Facts: What the Duck Curve Tells Us About Managing a Green Grid ,” 2016. Available at
https://www.caiso.com/Documents/FlexibleResourcesHelpRenewables_FastFacts.pdf.
18 Denholm, P., O’Connell, M., Brinkman, G. and Jorgenson, J., National Renewable Energy Laboratory, “Overgeneration
from Solar Energy in California: A Field Guide to the Duck Chart,” November 2015. Available at
http://www.nrel.gov/docs/fy16osti/65023.pdf.
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future, there will be less need for very large power stations, like the Diablo Canyon Power Plant, that operate
around the clock at a fairly constant rate and have not been designed to ramp their output up and down in short
intervals of time (or even over the course of the day). Given California’s energy goals that require increasing
reliance on renewables, the ISO will need more flexible resources while the need for baseload electricity supply
will decrease.
PG&E’s own power-resource procurement needs will also evolve in response to the state’s policy goals. This will
mean that PG&E itself will need fewer conventional baseload power plants to meet the needs of its electricity
customers. Over the next 15 years, PG&E is required by SB 350 to increase the amount of renewable energy it
procures from the market from 33 to 50 percent. Combined with the outlook for less electricity demand that will
result from aggressive installation of energy efficiency measures, lower grid-supplied sales resulting from
customers choosing to produce power on their own premises, and continued supply from the company’s large
fleet of hydroelectric facilities, PG&E has projected that any remaining non-renewable generation needs will
decline year over year, reducing the need for market purchases of natural gas-fired generation and for the
baseload power from the large Diablo Canyon Power Plant in the post 2025 timeframe.
Simply put, PG&E will continue to deliver power between suppliers and customers, but the character of the power
market will change so much that PG&E simply needs less conventional power supply. This outlook is illustrated
in the figure below. In Figure 4, the outlook is shown for two potential scenarios: (1) high penetration of
CCA/DA and (2) low penetration of CCA/DA. The gray segment at the top of each year’s column represents the
amount of customer requirements that are either reduced by energy efficiency or provided by customers choosing
another source of supply than PG&E (e.g., through self-generation or opting to buy power from another supplier).
Figure 5’s green-colored segments depict renewable requirements under the RPS and PG&E’s hydro resources.
In both cases, 50 percent of the company’s electricity must come from qualifying renewable energy sources (the
light green segment) by 2030, as required by SB 350. The remaining amount (“other,” in blue) is the residual
resource need to be met with some combination of fossil, nuclear, or additional renewables. This amount declines
steadily over time in either scenario, and is reduced to about 16 TWh in 2030 in the High CCA case and 24 TWh
in the Low CCA case.
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Figure 4. PG&E’s projected resource needs: decline in conventional generation
To put these numbers in perspective, the total output of the Diablo Canyon Power Plant was over 16 TWh in
2015.19 Thus, its output could exceed the “other” category of resource procurement or be a significant share of
that other amount. Notably, Diablo Canyon is a big, two-unit station whose baseload operations make it difficult
to ramp up and down within a day or a season, and whose economics make it an unlikely candidate for operating
at less than its full output. Its operating profile becomes increasingly incompatible with what California’s electric
system and PG&E’s customers will need in the future. Under either scenario, it will not make sense for Diablo
Canyon to supply such a high proportion of the generation that will be needed to balance PG&E’s supply and
demand profiles. As PG&E increases its reliance on variable renewable resources, it will need increasingly
flexible resources to balance its portfolio rather than inflexible, baseload generators such as Diablo Canyon.
3. Challenges with Renewable Overgeneration
Another aspect of this changing electrical system is the potential for California to face the prospect of mounting
“overgeneration” conditions, with the need for the system operator to take action to curtail generation (e.g.,
dispatch generators down, or even disconnect supply from the grid) in order to maintain electric system reliability.
As indicated above, many recent studies have evaluated this issue.20 An electric system’s supply and demand
must be in balance at all times, and if there’s too much supply coming on to the grid relative to customers’
demand for power, something has to give. Power plants with operational flexibility can be dispatched or ramped
down. Certain generating resources can be turned off (or curtailed). There is less room on the system for large,
inflexible baseload resources such as the Diablo Canyon Power Plant, which are operated either all on or all off,
as California increases its reliance on renewable resources.
The outlook for overgeneration (and the need to address this condition) results when consumers’ electricity
demand falls relative to the production output of generating resources, and where generation at non-dispatchable
renewable facilities and dispatchable conventional power plants cannot be reduced enough due to physically
inflexible operations (e.g., at a slow-ramping or baseload generating unit like a nuclear plant) or other “must-run”
19 PG&E Corporation. “2015 Joint Annual Report to Shareholders.”
20 See, for example: Denholm, P., O’Connell, M., Brinkman, G. and Jorgenson, J., National Renewable Energy Laboratory,
“Overgeneration from Solar Energy in California: A Field Guide to the Duck Chart,” November 2015. Available at
http://www.nrel.gov/docs/fy16osti/65023.pdf.
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concerns (e.g., the need to keep a plant on line for local reliability purpose). Without a reduction in power
production to keep the system in balance with demand, the system would overload and potentially cause serious
harm to grid reliability. The only solution available to the grid operator at the point of potential overgeneration is
to “curtail” output at non-dispatchable wind or solar resources: that is, by temporarily disconnecting or reducing
output from solar projects and wind turbines. These resources are the ones curtailed because at that point in
system operations, they’re the only ones that the operator still can turn up or down fast enough to avoid the
overgeneration situation. Such curtailment is thus a technical tool to keep the system in balance and fully
operational.
The prospect of overgeneration and curtailment is a particular concern on spring days, when demand for
electricity can be relatively modest and when output from solar generation may surge during sunny midday hours.
Figure 5 illustrates the load profile in California on a recent spring day (A). This is a plot of actual historic
production and load data from CAISO (Renewables Watch website). At current levels of solar power in
California, the ratio of solar and conventional resources has generally avoided the need for curtailment, because as
solar output increases starting in the morning hours, other resources can be dispatched down sufficiently to avoid
overgeneration conditions. The scenario on the right (B) illustrates the profile of a grid with significant,
additional solar capacity (it assumes tripling the output reported for May 19, 2016), combined with a significant
quantity of inflexible baseload resources. This profile is consistent with projections for the California grid within
the next five to ten years if baseload resources are not retired from the system. This combination creates the
concern for potential overgeneration conditions and the need for curtailment of solar supply during hours of the
spring-time day. Starting at around 9:00 am, the grid operator cannot dispatch down conventional generating
resources (the blue bar) enough to avoid pushing total generation over total demand (the black line). To avoid
overgeneration at any instant, the grid operator has to act – and curtail whatever resources can be quickly
controlled, including wind and solar plants.
Figure 5. Illustration of overgeneration requiring curtailment under a high solar output scenario
California will need more flexible supply and load resources to integrate higher levels of solar output and less
inflexible baseload generation on the system. The latter raises the specter of unacceptable levels of
overgeneration.
Source: Left-hand chart is plot of actual historic production and load data from CAISO (Renewables Watch
website). Right-hand chart is an illustrative example assuming 3x increase in May 19, 2016 solar production
and minimum baseload. This level of PV is expected in early 2020s.
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Looking ahead, solar generation on PG&E’s system and throughout California, is projected to significantly
increase due to two trends. First, customers are expected to add increasing amounts of smaller-scale solar systems
on their rooftops and land. These will be privately-owned distributed generation solar systems on customers’
premises. Additionally, PG&E and other utilities will be procuring increasing amounts of resources from large,
“utility-scale” solar projects over time to meet the 50 percent State Renewables Portfolio Standard. This
increasing amount of variable solar generation moves California’s resource mix in the direction of Scenario B in
Figure 5 above.
In fact, under some assumptions about the timing of growth in solar installations, the overgeneration outlook
could be even more challenging on the California system. In fact, occasional “overgeneration” events have
already occurred. PG&E will need to make substantial changes to its supply-side portfolio to reduce the output
from conventional generation that would otherwise result in overgeneration events.
One of these resources is Diablo Canyon, which operates as a “baseload” unit, running around the clock whenever
it is operating. Diablo Canyon is not able to vary its output in line with the real-time changes to the generation
output on the grid. When more solar generation comes on line over time and when its output is at peak supply
(e.g., in the middle of the day) and with Diablo Canyon operating at full output, there will be a high likelihood of
pushing total generation in excess of demand, leading to the potential curtailment of some of these same solar
resources. This would fundamentally make it more difficult to meet California’s 50 percent RPS mandate in a
cost-effective and efficient manner. Replacing Diablo Canyon with more flexible GHG-free resources and larger
scale storage would significantly reduce this effect.
Retirement of Diablo Canyon on the timeframe agreed to in the joint proposal will allow for increased flexibility
for the California system, helping to maximize the value of solar and other variable resources that will be a crucial
part of meeting PG&E’s renewable targets and California’s renewable and GHG emissions goals.
4. Ongoing Costs for Diablo Canyon
Diablo Canyon has served as a valuable resource providing reliable electricity for decades. However, future
operating costs are uncertain due to a variety of potential regulatory and other factors and could increase as the
facility ages. Additionally, due to expected overgeneration throughout parts of the year, Diablo Canyon may
contribute to higher system costs as its current generation profile causes challenges for efficiently integrating
renewable resources.
Facility Costs
Traditionally, the cost of nuclear generation is largely attributable to initial installation. Once in place, the low
fuel costs compared to natural gas and coal facilities offset the more complicated and expensive maintenance and
safety operations. However, as facilities age, this maintenance may increase in cost. Additionally, California’s
environmental protection regulations and other state and federal requirements may increase future costs beyond
2025. These include, for example, any environmental mitigation or compliance measures required by California
resource agencies, such as the California Coastal Commission and California State Lands Commission, which
must provide discretionary approvals necessary for Diablo Canyon to operate beyond its current Nuclear
Regulatory Commission (NRC) operating licenses. Such costs are unclear at this time. Diablo Canyon may also
have to undergo costly retrofits to comply with the State Water Control Board’s Cooling Water Intake Structures
regulation. These are the regulations impacting the amount of water extracted from the Pacific Ocean for cooling
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water and other purposes at the facility. Estimates for costs to mitigate impacts associated with this activity have
ranged from approximately $1 billion to upwards of $9 billion and could also include operational changes, which
would reduce the overall capacity factor of the facility, thereby potentially increasing the production costs of the
plant. Finally, the NRC may impose additional regulations or orders in response to federal regulatory or
legislative changes either currently under consideration or in the future.
System Costs
In addition, Diablo Canyon will contribute to higher system costs over time due to its non-ramping baseload
status. The California power grid is in a period of unprecedented change with growing reliance on renewable
resources, which require integrating resources that can ramp up and down quickly in response to changing
renewable output on a real-time basis. Relicensing Diablo Canyon at this time would commit PG&E to a large
amount of baseload generating capacity that could instead complicate renewable integration and force increased
curtailment of renewable resources and additional investment in other resources to manage the operational
balance of the overall system. The continued operation of Diablo Canyon past the current license period would
likely contribute to the frequency and magnitude of overgeneration events in the future, leading to increased
levels of renewables curtailment. This problem contributes to rising system costs in terms of the economic value
and environmental value of wasted renewable resources. Therefore, if Diablo Canyon were not relicensed, the
cost to integrate renewables could be lower.
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Overview of Joint Proposal and Implementation
The joint proposal ensures an orderly replacement of Diablo Canyon with energy efficiency and renewable
generation. Through the joint proposal, PG&E commits to achieving a 55 percent renewables portfolio through
specific procurement provisions while setting a responsible and achievable transition for replacing Diablo
Canyon.
Key Components of the Joint Proposal
Under the joint proposal, PG&E will continue to operate Diablo Canyon at current levels through the current
license period. In 2024, PG&E will retire Unit 1, and in 2025 will retire Unit 2. To ensure GHG-free
replacement of this energy, the settlement lays out procurement requirements starting in 2018 and continuing
through 2031. In step 1, PG&E will procure 2,000 GWh of new energy efficiency projects and programs to be
installed from 2018 to 2024. In a second step, PG&E would procure another 2,000 GWh of energy efficiency or
GHG-free energy to be initiated between 2025 through 2030. As a final step, PG&E commits to procure the
necessary levels of additional GHG-free energy required to meet a 55 percent RPS by 2031.
In addition to the specific procurement provisions, parties agree to support (before the CPUC and the CAISO) the
use of GHG-free resources, including but not limited to pumped hydroelectric storage, for additional reliability
and resource integration solutions which may be required to replace Diablo Canyon.
Figure 6. Joint proposal timeline and key components
Step 1:
PG&E procures 2,000 GWh of new energy
efficiency projects and programs to be installed from 2018 to
2024.
Step 2:
PG&E procures 2,000 GWh of
GHG-free energy or energy efficiency
offerings to be initiated between 2025 and
2030.
Unit 2
Retirement
Unit 1
Retirement
Diablo Canyon:
2018 2024 2025 2026-2030 2031 and Beyond2019-2023
Step 3:
PG&E procures GHG-
free energy to meet 55
percent Renewables
Portfolio Standard.
Potential for Additional GHG-free Resources
In addition to the specific energy efficiency and renewables provisions, parties agree to strongly support (before the CPUC and CAISO) use of
additional GHG-free resources, including but not limited to pumped hydroelectric storage, for reliability and resource integration solutions that
may be required to replace Diablo Canyon.
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Joint Proposal Implementation Considerations
The joint proposal commits PG&E to specific energy efficiency and renewables targets. However, the three steps
of resource procurement proposed in the joint proposal are not necessarily intended to capture everything that will
be needed to ensure the orderly replacement of Diablo Canyon with GHG-free resources. As discussed earlier,
the parties recognize clear trends that are decreasing PG&E’s electricity sales due to energy efficiency measures
and departing load from privately-owned, distributed generation and CCA programs. However, there remains
uncertainty as to the exact level of generation that will be required to serve demand. As such, the joint proposal
provides a baseline of renewables and energy efficiency procurement levels, while leaving open flexibility
through future procurement proceedings to accommodate market uncertainties.
The full solution for replacing Diablo Canyon and serving customer demand will emerge over the 2024-2045
period, in consultation with many parties and with the oversight of the CPUC, the CAISO, the CEC, the
Governor, and the Legislature. The CPUC will play an important role in approving the currently proposed
resource procurement and ensuring reasonable cost recovery. Any additional procurement that is needed on a
system-wide basis and not specified in the joint proposal would likely be addressed through the CPUC’s
integrated resource planning process. For example, future studies may show additional resources are needed for
the balancing of the electric system and integration of increased levels of renewable resources. As part of this
process, the parties have agreed to support the use of GHG-free resource solutions, including additional large
pumped storage, to meet future reliability and resource integration needs.
In the next two years, PG&E will prepare a site-specific decommissioning plan for Diablo Canyon. PG&E’s plan
will complement the joint proposal by following the agreed to schedule and will augment it with additional
important detail, such as a schedule for post-shutdown treatment of spent fuel. In this joint proposal, PG&E has
committed to pursuing dry cask storage as promptly as is feasible. PG&E will formally withdraw its NRC license
renewal application following CPUC approval of the joint proposal.
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Joint Proposal Impacts on Emissions, Reliability,
Affordability, and the Community
Emissions Impacts of Joint proposal
In total, the joint proposal will contribute to significant and sustained increases in renewables and non-nuclear
GHG-free energy in PG&E’s portfolio.
PG&E’s portfolio has long been one of the lowest emitting in the country. Half or more of its procured electricity
is consistently GHG-free, and renewable procurement has more than doubled in the last seven years. According
to data gathered by MJB&A that analyzed the 2014 emissions of the top 100 power producers in the country,
PG&E’s generating fleet had the lowest CO2 emissions rate of any utility at 116 lb/MWh.21 In 2014, renewable
generation constituted 27 percent of all
delivered energy to bundled customers, and
56 percent of all deliveries were GHG-free.
By 2030, PG&E commits to reaching 55
percent renewable deliveries under the
joint proposal, representing nearly a
doubling of today’s renewable
procurement and a 10 percent increase over
state regulatory requirements.
Furthermore, depending on future demand
assumptions, including additional energy
efficiency procurement and output from
PG&E’s hydroelectric fleet, PG&E’s 2030
bundled portfolio will be anywhere from
72 to 76 percent GHG-free. In all, this will
contribute to a significant decrease in GHG
emissions associated with PG&E’s bundled
portfolio, from 35 to 60 percent below
2014 levels.
21 M.J. Bradley & Associates, LLC, “Benchmarking Air Emissions of the 100 Largest Electric Power Produc ers in the
United States,” July 2015. Available at http://www.mjbradley.com/benchmarking-air-emissions.
Figure 7. PG&E GHG-free deliveries and deliveries by fuel type
Source: PG&E Power Content Labels
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Figure 8. Projections of renewable and GHG-free energy deliveries and CO2 emissions under the joint proposal
Maintaining Reliability
The joint proposal includes a mix of GHG-free resources that facilitate reliability, resource integration, and other
long-term cost-effective system benefits. The parties are confident that Diablo Canyon can be retired while
continuing to maintain a cost-effective PG&E electric system.
It is of utmost importance that PG&E delivers power safely and reliably to all customers. For decades, Diablo
Canyon has contributed to this effort. However, as the facility has approached the end of its current license,
numerous agencies have begun to assess what the grid would look like without the contributions of Diablo
Canyon. These studies all show that Diablo Canyon could be removed from the California electric system
without harming reliability.
The 2011 Integrated Energy Policy Report, released by the CEC in consultation with the CPUC, recommended
that the CAISO, “to support long-term energy and contingency planning,…should report to the Energy
Commission…on what new generation and/or transmission facilities would be needed to maintain system and/or
local reliability in the event of a long-term outage at Diablo Canyon.” Accordingly, CAISO conducted two
studies as part of their 2012-2013 transmission planning cycle, one addressing the immediate (2017-2018)
impacts of removing Diablo Canyon from the system for an “extended outage” and the other assessing the long-
term (through 2022) impacts. These studies focused on grid reliability implications for northern California and
ISO overall, and were not intended as a basis for a decision to keep or retire the generator.
Source: MJB&A analysis based on data provided by PG&E
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The CAISO determined that “there was no material mid- or long-term transmission system impacts associated
with the absence of Diablo Canyon.”22 Minor thermal overloads were noted to regional transformers and
transmission lines, which the ISO recommended could be addressed through upgrades to stretches of lines and the
imposition of Special Protection Systems. The study also did not identify any voltage, reactive power, or
transient stability issues (with the exception of possible reactive power shortages under extreme and highly
unlikely contingency situations).
Indeed, the electric grid is maintained in a manner that ensures that even the loss (temporary or permanent) of a
large generator can be absorbed by the system in order to keep electricity flowing even in the case of
unanticipated outages. Large power plants like Diablo Canyon are planned for specifically, since at some
moments they can provide large portions of the grid’s available power. PG&E has noted that, in ensuring that it
maintains a reliable system with Diablo Canyon, the utility’s transmission system has been maintained and
designed in order to withstand the loss of both Diablo Canyon units.23
To further prioritize reliability, the joint proposal provides for a deliberate and orderly transitio n away from
Diablo Canyon by beginning planning eight to nine years before the first unit retires. This lead time allows for
the orderly and reliable replacement of Diablo Canyon. PG&E will work with regulators and stakeholders to
meet the terms of the joint proposal for procuring additional renewable energy and energy efficiency, as well as
any other necessary resources and system upgrades, to maintain a reliable electric grid.
Continuing Competitive Procurement and Generation
PG&E will procure GHG-free replacement resources through CPUC-approved competitive bidding processes,
which will ensure that the lowest-cost clean resources are used to replace Diablo Canyon, and that the relevant
stakeholders are involved in monitoring and assisting the procurement process.
A number of studies help to demonstrate how Diablo Canyon generation could be cost-effectively replaced by
GHG-free resources. NREL noted that California’s “climate and clean energy goals are technically feasible
without significant rate impacts” even without including Diablo Canyon.24 Additionally, this study emphasizes
that although Diablo Canyon does provide GHG-free generation, “the retirement does allow greater flexibility in
integrating renewables since the plant provides inflexible baseload energy,” which in turn leads to more flexible
and cost-effective PG&E procurement.
Similarly, Energy + Environmental Economics showed in their PATHWAYS project that long-term GHG
reduction scenarios are possible, even when assuming Diablo Canyon is not part of the electricity mix. Further,
this study found that successfully reducing California’s greenhouse gas emissions would require significant
progress on: (1) increasing the achievement of energy efficiency in buildings and transportation; (2) switching to
lower carbon fuel sources in buildings and transportation; (3) producing lower carbon electricity; (4) producing
22 California Independent System Operator, “Board -Approved 2012-2013 Transmission Plan,” March 20, 2013 at p. 162.
Available at http://www.caiso.com/Documents/BoardApproved2012-2013TransmissionPlan.pdf
23 PG&E, “Comments of Pacific Gas and Electric Company on the Draft CAISO 2012-2013 Transmission Plan and
February 11, 2013 Stakeholder Meeting,” February 25 2013 at p. 1. Available at
http://www.caiso.com/Documents/PGECommentsDraft2012 -2013TransmissionPlan.pdf.
24 NREL’s Center for Energy Efficiency and Renewable Technologies, “The Low Carbon Grid Study, Phase II Results,”
February 2016. Available at http://www.nrel.gov/docs/fy16osti/64884.pdf.
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lower carbon liquid or gaseous fuels; and (5) reducing non-energy greenhouse gases. The joint proposal makes
significant progress toward each of these electricity-related objectives.25
25 Energy + Environmental Economics, “Summary of the California State Agencies’ PATHWAYS Project: Long -term
Greenhouse Gas Reduction Scenarios,” January 2015. Available at
https://ethree.com/documents/E3_Project%20Overview_20150126v2.pdf.
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Commitment to PG&E Employees and Community
Key provisions of the agreement reflect the fact that PG&E depends upon and has been committed to its
employees and the communities in which the utility operates and serves customers, and the utility and state have
benefited from a well-trained, highly skilled and dedicated workforce at Diablo Canyon for its 31 years of
operations. Diablo Canyon has provided electricity over 90 percent of the time, only stopping output for planned
refueling and maintenance. PG&E employs more than 1,500 workers at the facility, plus additional temporary
workers during high activity times such as refueling.
PG&E has committed to continuing the safe and secure operation of Diablo Canyon through its current license
period and to provide generous resources and assistance to transitioning workers. Under the joint proposal, it will
be critical to retain existing employees, who are highly qualified and will drive continued safe and reliable
operations. PG&E will provide a generous retention program and severance payments upon completion of
employment. Additionally, PG&E will help employees transition to new positions through a retraining and
development program to facilitate redeployment of a portion of plant personnel to the decommissioning project.
PG&E has agreed to provide a detailed description and cost estimate of PG&E’s retention program for
Commission approval in the joint proposal application. The parties support redeployment and training of a
portion of current Diablo Canyon employees for the decommissioning project.
The joint proposal also recognizes the place that Diablo Canyon has had in the local economy for the past three
decades. The Diablo Canyon Power Plant is one of the largest employers, taxpayers, and charitable contributors
in the San Luis Obispo County area. It currently contributes approximately $22 million in annual property taxes
to the local community. In order to continue to support this local community even as the facility begins to retire,
PG&E proposes to continue to provide funding to San Luis Obispo at current property tax levels through 2025 (as
opposed to a typical payment schedule, which would scale them back every year in line with the depreciation
schedule of the facility). The payment in lieu of taxes would be recovered through nuclear decommissioning
funding. PG&E estimates that the total cost of the Community Impacts Mitigation Program is approximately $50
million.
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Conclusion
The joint proposal provides for the orderly replacement of Diablo Canyon Power Plant with GHG-free resources.
The proposal builds on the realities of a changing electricity landscape in the state, one that includes increasing
levels of self-generation, community choice aggregation, and renewable energy resources, all of which decrease
PG&E’s need for other sources of generation. These forces reduce the need for Diablo Canyon’s output beyond
the current license period.
California’s path toward achieving aggressive and critical environmental targets is recognized and reflected in the
proposal, which builds upon these targets and offers additional commitments for energy efficiency and
renewables that go beyond existing requirements. The joint proposal turns toward the procurement of cost-
effective GHG-free resources and flexible integrating resources that will be a crucial part of meeting California’s
renewable and GHG emissions goals. The joint proposal will help California set the stage for even deeper GHG
reductions that will be required to meet long-term emissions targets. The proposal also ensures that this transition
is conducted while maintaining system reliability and supporting PG&E employees and the local community.
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Concord, MA
Headquarters
47 Junction Square Drive
Concord, Massachusetts
United States
Tel: 978 369 5533
Fax: 978 369 7712
www.mjbradley.com
Washington, DC
1225 Eye Street, NW, Suite 200
Washington, DC
United States
Tel: 202 525 5770
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M.J. Bradley & Associates, LLC
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Joint Proposal for the Orderly Replacement of
Diablo Canyon Power Plant with Energy Efficiency and Renewables
J U N E 2 1 , 2 0 1 6
Last update: July 8, 2016 (appendix)
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Joint Proposal
The joint proposal:
•ensures the cost-effective and orderly replacement of Diablo Canyon with GHG-free resources
•provides a responsible and supportive transition for Diablo Canyon employees and the community
•facilitates renewables integration through a reliable and more flexible resource mix
•greatly diminishes Diablo Canyon impacts on fishery resources at the end of the current license
period, avoiding the need to install cooling towers under California's once-through-cooling policy
2
PG&E, International Brotherhood of Electrical Workers Local 1245, Coalition of California Utility
Employees, Friends of the Earth, Natural Resources Defense Council, Environment California, and
Alliance for Nuclear Responsibility have developed a joint proposal to phase out PG&E’s Diablo
Canyon Power Plant (DCPP) by 2025 and replace it with energy efficiency, renewable energy and
other GHG-free resources.
MJB&A was retained by the parties to the joint proposal to facilitate
development of this report and related documents.
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2. What Has Changed?1. Why Now?
Diablo Canyon is subject to
federal relicensing and state
approvals to continue
operations past its current
license period.
Diablo Canyon will be replaced with
energy efficiency, renewables, and
other GHG-free resources, and in the
process, help reach California’s
climate and energy goals.
3. How Will Diablo
Canyon Be Replaced?
Demand for Diablo Canyon’s
output is falling due to
California energy policies and
changing market conditions.
PG&E will provide generous
retention & retraining programs
for employees and financial
support for the community.
3
Background for Joint Proposal
4. How Will PG&E
Support the
Employees
and Community?
The joint proposal
allows for the orderly
and reliable phase out
of Diablo Canyon with
GHG-free resources.
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California’s Goals
50% renewables by 2030
Double energy efficiency savings by 2030
Optimal integration of renewables
80% decline in greenhouse gases by 2050
Joint Proposal
55% renewables by 2031 (PG&E electricity sales*)
Implement additional energy efficiency programs between
2018-2024
More flexible generation mix to integrate renewables
Facilitates California’s climate goals
4
Investing in California’s Energy Future
The joint proposal is a reliable, flexible, and cost-effective solution to phase out the Diablo Canyon
Power Plant with GHG-free resources and will help reach California’s energy and climate goals.
The proposal includes:
1.Specific commitments to procure energy efficiency and renewables
2.Commitment to 55 percent renewable generation in 2031, compared to state target of 50 percent
3.Flexibility for procuring additional GHG-free resources as needed over the 2024-2045 period, in
consultation with many parties and oversight of California authorities
*Throughout this presentation, “electricity sales” refers to PG&E’s bundled retail sales (i.e., “bundled” electricity, transm ission and distribution services).
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Challenging Policies and Market Conditions for Diablo Canyon
1. Uncertain Electricity Supply Needs for PG&E
Resource Planning Challenges Beyond Current License Period
4. Uncertain Rising Costs for Diablo Canyon
2.Declining Need for Diablo Canyon Generation
3. Challenges with Inflexible Baseload Generation
California’s changing electric grid has a declining need for large, inflexible baseload power plants.
These evolving market conditions combined with the falling costs of energy efficiency and renewables
underpin the proposal to phase out the Diablo Canyon Power Plant.
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1. Uncertain Electricity Supply Needs for PG&E
6
EE & PG&E
Departing Load
PG&E
Electricity
Supply
Obligations
High CCA Penetration Low CCA Penetration
Energy efficiency (EE) programs, growth in distributed generation (DG), and Community Choice
Aggregation (CCA) & Direct Access (DA) policies create significant uncertainty for PG&E’s electricity
sales (Bundled Portfolio).* Future electricity sales could fall significantly below current levels.
Source: MJB&A analysis based on data provided by PG&E
Key Insights
•The two projections shown above illustrate the range of uncertainty for PG&E resource planning.
•The projected amount of EE and departing load by 2030 exceeds total DCPP generation by at least several fold.
•EE, DG, CCA and DA are projected to reduce PG&E electricity sales by 3 to 21 TWh below current levels by 2030.
*See Glossary of Terms in the appendix.
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2. Declining Need for Diablo Canyon Generation
7
High CCA Penetration Low CCA Penetration
Resource needs from conventional generation sources are projected to decrease due to falling
electricity sales and increasing renewables supply.
Source: MJB&A analysis based on data provided by PG&E
Key Insights
•Rising renewables generation combined with flat to falling electricity sales reduces additional supply needs (labeled
above as “other”) and requires that these additional resources be increasingly flexible to reliably balance supply and
demand.
•In the High CCA case, output from PG&E’s hydropower and DCPP resources would exceed PG&E’s resource needs
in 2030 after accounting for state renewable energy requirements.
EE & PG&E
Departing Load
PG&E
Electricity
Supply
Obligations
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3. Challenges with Inflexible Baseload Generation
8
am pm am pm
Overgeneration
(requiring curtailment)
Conventional
Other Renewables
Solar
A. California Today
Actual Spring Day –May 19, 2016
B. Illustration with High Solar
Penetration –Same Spring Load Profile
Load
For more analysis of this issue:
NREL’s “Overgeneration from Solar
Energy in California: A Field Guide to the
Duck Chart” (Nov. 2015).
California ISO’s “What the duck curve
tells us about managing a green grid”
(2016).
A. Current System
Increasing levels of variable generation
require more flexible grid operations to
match changing supply and demand
patterns.
California’s existing grid has been able
to accommodate increasing solar output
with only occasional “overgeneration”
events where electricity supply exceeds
demand. Under these conditions,
system operators must curtail the output
of wind and solar resources.
B. Overgeneration Condition
In the future, overgeneration is projected
to become a more acute problem based
on California’s current electric grid and
inflexible generating resources such as
Diablo Canyon. The grid will need to be
transformed with more flexible supply
and load resources to integrate higher
levels of solar output.
Overgeneration conditions reduce the
economic value and environmental
benefits of renewable energy projects.
Options to Address Overgeneration
A more flexible system allows system
operators to accommodate higher levels of
solar penetration by relying on more flexible
generating facilities, energy storage, and
demand response. Some of the options to
address the overgeneration illustrated in
Chart B would include:
Shift to more flexible resources that
can accommodate more frequent
cycling and starts and stops.
Shift load from the evening hours to
midday capturing more of the solar
energy supply.
Shift renewable energy supply away
from peak generation periods using
energy storage technologies.
1
2
3
Source: plot of actual historic production and load
data from CAISO (Renewables Watch website).
3 x Solar
Source: Illustrative example assuming 3x increase in
May 19, 2016 solar production and minimum baseload.
This level of PV is expected in early 2020s.
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4. Uncertain Rising Costs for Diablo Canyon
Independent studies highlight the
benefits of phasing out DCPP.
•“We can confidently state that on a
life cycle basis the investment in
renewables and efficiency will, over
time, provide customers with lower
cost electricity than DCPP...” Friends
of the Earth. Plan B Study, January 2016.
(economic analysis by William B. Marcus)
•“Climate & clean energy goals are
technically feasible without
significant rate impacts.” (The
National Renewable Energy
Laboratory modeled California
emissions goals with DCPP retired)
The Center for Energy Efficiency and
Renewable Technologies. The Low Carbon
Grid Study, Phase II Results, February 2016.
•California’s Pathways analysis
demonstrates approaches for
achieving state GHG goals without
DCPP. E3. California State Agencies’
Pathways Project,April 2015.
The costs of operating beyond
2024/2025 are uncertain.
Cost increases could include:
•Facility operations and
maintenance
•State cooling water compliance
•Environmental compliance costs
for state approvals of extended
operations period
•Potential Nuclear Regulatory
Commission (NRC) regulations or
orders
Facility Costs1
Commitment to a large amount of
baseload generation leads to rising
and uncertain system costs due to
current market trends.
Market trends include:
•Declining and uncertain demand
outlook
•Growing need for flexible
resources to integrate renewables
rather than inflexible baseload
generation
The joint proposal enables PG&E to
focus on reliable, flexible, and cost-
effective GHG-free resources that
help to optimize the overall system.
System Costs2 Benefits Studies3
9
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The joint proposal commits PG&E to specific energy efficiency and renewable energy targets and to a
55 percent Renewables Portfolio Standard while setting a responsible and achievable transition for
replacing Diablo Canyon.
10
Orderly Replacement with Energy Efficiency and Renewables
Step 1:
PG&E procures 2,000 GWh of new energy
efficiency projects and programs to be installed from
2018 to 2024.
Step 2:
PG&E procures 2,000 GWh of
GHG-free energy or energy efficiency
offerings to be initiated between 2025
and 2030.
Unit 2
Retirement
Unit 1
Retirement
Diablo Canyon:
2018 2024 2025 2026-2030 2031 and Beyond2019-2023
Step 3:
PG&E procures GHG-
free energy to meet 55
percent Renewables
Portfolio Standard.
Potential for Additional GHG-free Resources
In addition to the specific energy efficiency and renewables provisions, parties agree to support (before the CPUC and
CAISO) use of additional GHG-free resources, including but not limited to pumped hydroelectric storage, for reliability
and resource integration solutions that may be required to replace Diablo Canyon.
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More Renewables and Fewer CO2 Emissions
Renewables
Portfolio
Standard
(% of sales)
GHG-Free
(% of generation)
CO2
Emissions
(million metric tons)
2014
(Actual)
Post-2030
Low CCA
(High Demand)
Post-2030
High CCA
(Low Demand)
Key Insights
•PG&E commits to achieving a 55
percent Renewables Portfolio
Standard under any future
demand trajectory.
•The percentage of GHG-free
generation increases and fossil
generation decreases in all
scenarios.
•Decline in fossil generation
drives down CO2 emissions in all
scenarios.
•The joint proposal facilitates
California’s renewable and GHG
emissions goals by supporting a
more flexible electric grid and
maximizing the value of
renewable resources.
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Maintaining Reliability and Competitive Costs
•The California Independent System Operator (CAISO)
has studied the reliability implications of the Diablo
Canyon facility: “This study determined that there was
no material mid-or long-term transmission system
impacts associated with the absence of Diablo
Canyon.” CAISO 2012-2013 Transmission Plan
•The transmission system is maintained to withstand
the loss of both DCPP units. PG&E-CAISO Nuclear
Plant Interface Coordination Agreement for Diablo
Canyon Power Plant
•By maintaining operations through the current license
period, the joint proposal allows for the orderly and
reliable replacement of Diablo Canyon.
•PG&E will procure GHG-free replacement resources
through California Public Utility Commission-approved
competitive bidding processes.
•The joint proposal is a cost-effective solution for
phasing out Diablo Canyon with renewables and
energy efficiency.
The joint proposal includes a mix of GHG-free resources that facilitate reliability, renewables
integration, and other long-term cost-effective benefits for the electric grid.
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•Diablo Canyon has operated reliably since 1985 with an average capacity factor of more than 90%
between refueling and maintenance outages.
•Under the joint proposal, the facility would continue to operate through its current license period.
•PG&E employs more than 1,500 workers at the facility, plus additional temporary workers during
scheduled refueling outages. It is critical to retain these highly qualified personnel at DCPP during the
remaining years of operations.
•PG&E will provide generous resources and assistance to employees including incentives to retain
employees, a retraining and development program to facilitate redeployment of a portion of plant
personnel to the decommissioning project, and severance payments upon completion of employment.
•PG&E proposes to offset loss in property taxes while the facility is depreciated to 2025 to create a
source of stable community funding during the transition period.
Commitment to PG&E Employees and Community
PG&E and all of California has benefited from a well-trained, highly skilled and dedicated workforce
at DCPP for its 31 years of operations. PG&E is committed to the employees and the community.
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•The energy efficiency and renewables provisions proposed in this joint proposal are not intended to
capture everything that will be needed to ensure the orderly replacement of DCPP with GHG -free
resources.
•The full solution will emerge over the 2024-2045 period, in consultation with many parties and with the
oversight of the California Public Utilities Commission (“CPUC”), the California Independent System
Operator (“CAISO”), the California Energy Commission, the Governor, and the Legislature.
•The parties will file to implement the joint proposal after the State Lands Commission has extended the
Diablo Canyon lands lease through the current license period.
•The energy efficiency and renewables provisions are conditioned upon CPUC approval and assurance
of cost recovery.
•Additional GHG-free resources beyond that specified in the joint proposal may be needed on a system -
wide basis and the parties envision that this issue will primarily be addressed through the CPUC’s
integrated resource planning process.
•PG&E will formally withdraw its NRC license renewal application following CPUC approval of the joint
proposal.
•The parties will strongly support at the CPUC and before the CAISO the use of GHG -free resource
solutions, including additional large pumped storage.
•PG&E will prepare a site-specific decommissioning plan for Diablo Canyon by 2018 that will include a
schedule for post-shutdown transfer of spent fuel to dry cask storage as promptly as is feasible.
Clear Targets and Flexible Implementation
The joint proposal commits PG&E to specific energy efficiency and renewables targets and
provides flexibility for additional GHG-free resources to accommodate market uncertainties.
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Appendix
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Glossary of Terms
Bundled Service Customers refers to full-service customers who purchase both energy delivery services and energy
generation from PG&E. This is in contrast to customers who purchase energy from a third -party Energy Service
Provider, and pay PG&E for transmission and distribution costs.
Community Choice Aggregation, or CCA, is a program available within the service areas of investor-owned utilities,
such as PG&E, which allows cities and counties to purchase and/or generate electricity for their residents and
businesses. Under CCA, PG&E continues to deliver the electricity through its transmission and distribution system and
provide meter reading, billing, maintenance, and outage response services.
Direct Access Service is an optional service that allows customers to purchase electric supplies and additional energy
services from a competitive Energy Service Provider (ESP), rather than from PG&E. Although customers will purchase
their electricity from an ESP under direct access service, PG&E will continue to deliver the electricity through its
transmission and distribution systems.
Distributed Generation refers to small-scale electric generation facilities typically owned by non-utility entities, such as
generation developers or utility customers, that offset all or part of the customer’s on -site electrical load. Distributed
generation is often sited at a customer’s location or close to a load center. In contrast, central station generation is not
used primarily to serve the on-site electrical load, but instead serves the electrical needs of a large number of offsite
customers. Distributed generation may or may not be interconnected to the electrical transmission grid.
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M.J. Bradley & Associates, LLC
(978) 369 5533 / www.mjbradley.com
Concord, MA
Headquarters
47 Junction Square Drive
Concord, Massachusetts
United States
Tel: 978 369 5533
Fax: 978 369 7712
www.mjbradley.com
Washington, DC
1225 Eye Street, NW, Suite 200
Washington, DC
United States
Tel: 202 525 5770
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1
Corporate Relations | 77 Beale Street | San Francisco, CA 94105 | 415.973.5930 | www.pge.com
July 8, 2016
IN CONTINUED COMMITMENT TO COLLABORATION AND TRANSPARENCY,
PG&E ANNOUNCES DATES FOR PUBLIC MEETINGS TO DISCUSS JOINT
PROPOSAL
SAN FRANCISCO, Calif.— In line with its commitment to transparency and collaboration,
Pacific Gas and Electric Company (PG&E) invites community members to participate in public
information meetings regarding its previously announced joint proposal to increase energy
efficiency, renewables and storage while phasing out nuclear power over the next decade.
There will be four meetings, two in each location. The content of the meetings will be identical.
This is to provide more chances for the public to participate. At these meetings, PG&E staff will
present information about the joint proposal, address questions, and provide attendees an
opportunity to provide feedback and commentary on the joint proposal.
In late June, the State Lands Commission voted to approve a lease extension necessary to run
Diablo Canyon Power Plant (DCPP) to 2025, a critical first step toward realizing the goals
outlined in the joint proposal. Consideration of the joint proposal moves next to the California
Public Utilities Commission (CPUC). PG&E will file the proposal with the CPUC on July 28.
Following these meetings, a public report will be made available that summarizes public
questions and commentary gathered at these public information meetings and will be submitted
with PG&E’s filing with the CPUC.
Meeting Dates and Locations:
San Luis Obispo
July 20, 2016
Meeting 1: 12:00- 3:45pm
Meeting 2: 4:15-8:00pm
Embassy Suites
333 Madonna Road
San Luis Obispo, CA 93405
San Francisco
July 22, 2016
Meeting 1: 12:00- 3:45pm
Meeting 2: 4:15-8:00pm
South San Francisco Conference Center
255 S. Airport Boulevard
South San Francisco, CA 94080
Meetings are open to the public. Each meeting will cover the same information and follow the
same format.
For parties unable to attend public information meetings, comments can be submitted to
diablocanyon@pge.com prior to July 26, 2016.
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Joint Proposal
Reflecting California's changing energy landscape, PG&E announced a joint proposal with labor
and leading environmental organizations on June 21, 2016, that would increase investment in
energy efficiency, renewables and storage beyond current state mandates while phasing out
PG&E's production of nuclear power in California by 2025.
The joint proposal would replace power produced by two nuclear reactors at the Diablo Canyon
Power Plant (DCPP) with a cost-effective, greenhouse gas free portfolio of energy efficiency,
renewables and energy storage. It includes a PG&E commitment to a 55 percent renewable
energy target in 2031, an unprecedented voluntary commitment by a major U.S. energy
company.
The Parties to the joint proposal are PG&E, International Brotherhood of Electrical Workers
Local 1245, Coalition of California Utility Employees, Friends of the Earth, Natural Resources
Defense Council, Environment California and Alliance for Nuclear Responsibility.
The announcement of the Joint Proposal can be found here.
The Joint Proposal can be read in its entirety here.
Additional Information
Information on the State Lands Commission approval of necessary lease extensions can be
read here.
Additional information prepared by M.J. Bradley & Associates, a strategic environmental
consulting firm, can be accessed here.
Media contact:
PG&E 24-Hour Media Line
(415) 973-5930
About PG&E
Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is one of
the largest combined natural gas and electric utilities in the United States. Based in San
Francisco, with more than 20,000 employees, the company delivers some of the nation’s
cleanest energy to nearly 16 million people in Northern and Central California. For more
information, visit www.pge.com/ and www.pge.com/en/about/newsroom/index.page.
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